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  Canada Immigration Forum > About Canada > Real Estate & Mortgages > Income spent on mortgage
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Income spent on mortgage




tamilkuravan
Senior Desi
Member since: Jun 05




Posts: 5740
Location: God's own country


Jagmag,
As seen in another post, Seenappa lives in Scarborough. Even in Scarborough, this looks like a decent rent.
Intersection details can throw some more light as to how Seenappa got such a good deal.
TK A
Sidenote : May i add that we are off tracking a very good OP.

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Last edited by: tamilkuravan on 08-11-06 15:03:20
Post ID: 89334 08-11-06 15:00:34
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seenappa
Senior Desi
Member since: May 03




Posts: 254
Location: Brampton


well, jagmag and TK...what can i say? It must be my insanely good looks that got me this deal;)

Like TK said...It is scarborough and again the intersection...Eglinton and Mccowan Rd..That was 3 years ago when i moved here..not sure what it is now.

Ok..No more side tracking...back to the original topic.

seenappa


 
Post ID: 89336 08-11-06 15:52:40
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chittesh
Senior Desi
Member since: May 05




Posts: 448
Location: Here and There


Senario 3 : A detached or a semi detached house for $350K. I put 50K down.

Mortgage : $2325
Maintenance : $ 0
Hydro and Insurance : $100
Property taxes : $150
Rent from basement : $800

Total : $1775 (all monthly)

Guru's : Please correct me if i am wrong.


Me not a guru, but i can say the following:

50K vvv hard for a new immigrant..will need 3-5 years of solid savings..20-25 is a better down.

Property tax: 225-275 is a better estimate,Hydro and insurance: again 200-300 is a better estimate, includes heating and electricity also

Rent from basement: i wouldnt depend on it..It would be hard to get 800 from a Semi basement..650 is a better number


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Last edited by: chittesh on 08-11-06 16:19:01
Post ID: 89338 08-11-06 16:17:54
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chittesh
Senior Desi
Member since: May 05




Posts: 448
Location: Here and There


This is what i believe a new immigrant should do:

1) Go to Bramptom and look for a freehold townhome. You will get very very good one for 255K.
2) Make 25K down
3) Take mortgage of 230K
4) Go 30 years amortization if you are <35yrs old and 35yrs if you are <30 yes old and 25 if you are >40yrs old
5) Pay 1180/1250/1360 mortgage depending on your age as shown above.
6) As it is not a semi but a townhome freehold, there is no maintainance and property tax+maintainance is lower. So budget 225 for tax and 225 for heating.

7) Your living cost os 1250+450= 1700$pm.

Assume you have salary of 35K and wife has salary of 35K. Each will make 1050 biweekly so its 4400pm.
4400-1700= 2700pm for lving.

Out of which:

300 insurance for you and wife, will come down as u spend more time
300 gas for 2 cars. I small car like CIVIC buy used for 8-10K putting down.
350 finance for a family car like a Camry/Accord (not new but <3 yr old)
350 groceries
400 eating out and other entertainment
300 home improvement cost (new lawnmover, saving for new TV etc)
150 cellphone, internet, house security, home phone cable
------
1800
------
2700-1800 = 900$ save

So i think even with that basic salary it is possible to save 900$pm. Also add the two additional weeks when you get paid 3 times a month in biweekly so you save additional 4000$/yr

As u live more in the country.salary may go up, insurance may decrease, u pay some savings in advanced mortgage and the montly amount goes down etc etc


This estimate above is for a pretty decent life (not luxury)
1600-1800sq ft home
2 decent cars
400$ entertainment budget.

What say...












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Last edited by: chittesh on 08-11-06 16:37:11
Post ID: 89340 08-11-06 16:35:48
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Big Vee
Senior Desi
Member since: Jan 05




Posts: 456
Location: Canada-Glorious and Free

Percentage in housing...
Quote:
Originally posted by chittesh

Hi,
Without going into actual number can people in the forum tell me what percentage of their montly income after tax they spend on Mortgage+maintainance+property tax. Also can you let me know if you are a single family household or Dual (Husband+wife work) or more.
e.g if family makes 5000$ after tax per month and if your mortgage is 2500$ and 2 people work then you can answer as
50%, 2 incomes
or if you make 5000$ and you are single income and have mortgage of 1000$ then you can reply as 20%, 1 income

I really dont want numbers, so if you are willing to share information in the above format it will help me understand the general trend among desis here..

thanks
Chittesh



Chittesh,

I understand that you cannot get mortgages where the service load is more than 33% of the gross household income. The service load is diffrent for diffrent organizations, but it usually includes property taxes, mortgage principal and interest. Some companies include utilities.

BV


 
Post ID: 89341 08-11-06 16:36:58
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chittesh
Senior Desi
Member since: May 05




Posts: 448
Location: Here and There


Quote:

Chittesh,

I understand that you cannot get mortgages where the service load is more than 33% of the gross household income. The service load is diffrent for diffrent organizations, but it usually includes property taxes, mortgage principal and interest. Some companies include utilities.

BV



Pay 2500-3500$ extra to the mortgage broker and he will get you maortgage of 100% of your income. How much mortgage u want to take depends purely on you



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Post ID: 89342 08-11-06 16:42:05
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tamilkuravan
Senior Desi
Member since: Jun 05




Posts: 5740
Location: God's own country

Good Analysis
Quote:
Originally posted by chittesh

3) Take mortgage of 230K
4) Go 30 years amortization if you are <35yrs old and 35yrs if you are <30 yes old and 25 if you are >40yrs old
5) Pay 1180/1250/1360 mortgage depending on your age as shown above.



Good analysis Chittesh.
Looks very nice on paper but will run into a lot of difficulty practicall.
for one ,I am at a loss to see how a 230K mortgage will net you just $ 1360 a month. My calculations indicate excess of $1750.
Mortgage Guru's, Please advice.
Also I am a firm beliver that any house that you buy should have a rentable basment with sep.entrance. If cost is too much, let the owner live in Basment and leave the upper floors to rent. Also partitioning of basement into many rooms for bachelors (esp. in Brampton will be a prudent idea).
TK A

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Last edited by: tamilkuravan on 08-11-06 16:59:36
Post ID: 89343 08-11-06 16:53:26
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chittesh
Senior Desi
Member since: May 05




Posts: 448
Location: Here and There


230K mortgage at 5.14% for 25 yrs = 1360 a month (if it is withing the debt service ratio just go to ING and get that rate no need to go to a mortgage broker)
5.14% is 5yr fixed.
Once should also consider putting 50% in variable rate if they are mortgaging today as the rates are projected to come down by .75 to 1% by Dec 07

I will not rent my basement unless absolutely required. I will put a bar, some exercise equipment and a large screen tv in it...:D :cheers:

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Last edited by: chittesh on 08-11-06 17:09:58
Post ID: 89345 08-11-06 17:06:10
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Pramod Chopra
Senior Desi
Member since: Sep 03




Posts: 1284
Location: Pickering, ON



Quote:
Originally posted by dimple2001

Please do not take the percentages posted in this thread as a gospel. You will have to look at your affordability, lifestyle, requirements, other debts and obligations and then decide what percentage is good for you.




Well said Dimple 2001,

Everbody's situation is unique and one has to look at one's situation closely and then decide if one can afford the house or should continue to rent.



-----------------------------------------------------------------


Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada



 
Post ID: 89361 08-11-06 22:33:37
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Pramod Chopra
Senior Desi
Member since: Sep 03




Posts: 1284
Location: Pickering, ON


Quote:
Originally posted by tamilkuravan

Quote:
Originally posted by chittesh

3) Take mortgage of 230K
4) Go 30 years amortization if you are <35yrs old and 35yrs if you are <30 yes old and 25 if you are >40yrs old
5) Pay 1180/1250/1360 mortgage depending on your age as shown above.



Good analysis Chittesh.
Looks very nice on paper but will run into a lot of difficulty practicall.
for one ,I am at a loss to see how a 230K mortgage will net you just $ 1360 a month. My calculations indicate excess of $1750.
Mortgage Guru's, Please advice.
Also I am a firm beliver that any house that you buy should have a rentable basment with sep.entrance. If cost is too much, let the owner live in Basment and leave the upper floors to rent. Also partitioning of basement into many rooms for bachelors (esp. in Brampton will be a prudent idea).
TK A






Hi TK

Chittesh is mentioning here only the mortgage payments and he is correct as far as mortgage of $230 K at 35, 30 & 25 years amortiztion is concerned. The property tax, fire insurance and heat and hydro would be extra. I do not know where you got your figures from. May be you were adding property tax, insurance and heat hydro in your calculation.

However, Chittesh seems to have missed the insurance premium of approx. of $6000 to $7200 which will increase the mortgage payment to around $30 per month more in each case or you would have to pay this premium and tax on the same from your pocket at the time of closing.





Quote:
Originally posted by chittesh

............................

6) As it is not a semi but a townhome freehold, there is no maintainance and property tax+maintainance is lower. So budget 225 for tax and 225 for heating.

7) Your living cost os 1250+450= 1700$pm.

Assume you have salary of 35K and wife has salary of 35K. Each will make 1050 biweekly so its 4400pm.
4400-1700= 2700pm for lving.

Out of which:

300 insurance for you and wife, will come down as u spend more time
300 gas for 2 cars. I small car like CIVIC buy used for 8-10K putting down.
350 finance for a family car like a Camry/Accord (not new but <3 yr old)
350 groceries
400 eating out and other entertainment
300 home improvement cost (new lawnmover, saving for new TV etc)
150 cellphone, internet, house security, home phone cable
------
1800
------
2700-1800 = 900$ save

So i think even with that basic salary it is possible to save 900$pm. Also add the two additional weeks when you get paid 3 times a month in biweekly so you save additional 4000$/yr

As u live more in the country.salary may go up, insurance may decrease, u pay some savings in advanced mortgage and the montly amount goes down etc etc





Chittesh your total of the monthly expenses seems to be incorrect. As per your calculations it should be $ 2150 and not $1800. Please check if I am missiing some thing.


I would once again reiterate that every body's situation is unique and he/she should consider his/her situation, income, life style and affordability before deciding to buy a house.










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Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada



 
Post ID: 89362 08-11-06 23:16:58
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Contributors:
Big Vee(1)  chittesh(8)  dimple2001(1)  jagmag(1)  kanjis(2)  Pramod Chopra(3)  seenappa(3)  
tamilkuravan(7)  
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