This One Mortgage Rule Has Helped Make Homeownership More Affordable for Me

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A writer employed a specific strategy when signing her mortgage. Find out what it was. 

Years ago, my husband and I made the decision to upsize from our starter home to our current home. We knew we wanted kids, and while our old home was charming in its own right, it sorely lacked the square footage we expected to need once children came into the mix.

Not surprisingly, the home we upgraded to cost a lot more than what we sold our starter home for. But we made a large down payment on that home to keep our mortgage loan to a minimum. We also opted to employ one key rule that’s made the cost of homeownership much easier to keep up with through the years.

We made sure to buy a home we could pay for on one salary

My husband and I were both working at the time we bought our home, and have continued to both work since. But when we bought our home, we calculated how much house we could afford based on his income alone.

We figured that if we could swing our mortgage payments and other housing costs on only his salary, we’d have that much more wiggle room in our budget for things like home repairs, which we’ve faced our share of over time. And we also figured we’d be able to add more cash to a savings account if we weren’t relying on my income to cover our mortgage payments.

Another reason we bought a home we could pay for on my husband’s salary alone is that I’ve been self-employed for a long time, and my income is quite variable. Because of that, I’m far more comfortable basing our essential expenses on my husband’s salary, and then using my income for extras — things like travel or services like cable that we could always cancel in a pinch if we had to.

Meanwhile, since moving into our home 14 years ago, our property tax bill has risen by about $8,000. If you’re thinking that can’t possibly be true, recognize that New Jersey, where I live, has the highest property taxes in the country.

When our property taxes started to climb, it was very stressful. But because my income wasn’t earmarked or needed for our mortgage payments, we were able to cover the cost of those property tax increases by using my earnings without falling behind.

A rule that’s served us well

As a general rule, it’s important to keep your monthly housing costs, including your property taxes and homeowners insurance, to 30% of your take-home pay or less. And if you’re in a household with two earners, that 30% can apply to your joint income.

But in our case, we didn’t factor in my income when calculating what mortgage we could take on. And I’m really grateful we made that choice, because it’s made it much easier to cope with home repairs and surprise expenses. It’s also given us an opportunity to pad our savings so that we don’t have to lose sleep over the thought of an appliance breaking or yet another property tax hike.

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