Jenny's Monthly Budget
Student loan: $230.16
Cell phone: $80
Gas/transportation (including car payment for $400 per month) : $520
Total Monthly Expenses: $1,490.16
Budget Monthly Payment: $259.84
Mortgage Interest Rate: 3.13%
House I Can Afford: $60,618.57
I will purchase the condo for $60,000 or less in order to not max out my budget.
Actual monthly payment: $240.04
Over the course of the loan I will pay: $86,414.4
Increase Jenny's Monthly Payment by 15%
How long to pay off new amount? 17 years
Difference in total amount paid: $44,123.78
Jenny's SMARTER Decision with Savings
Jenny still works at the bank and lives close enough to walk, allowing her to sell her car and take the bus.
Jenny sold her 2011 white Jeep patriot with 75,000 miles for $7,500. She will use the $7,500 for my down payment on my new home.
Jenny will use the basic rule of thumbs of 50% to necessities, 40% to extra, and 10% to savings.
Necessities (payments per month)
Total Monthly Expenses: $1,075.16
Monthly budget for house: $674.84
Mortgage interest rate: 3.13%
What can I afford: $157,434.70
I will purchase the home for $130,000 in order to not max out my budget.
Actual monthly payment: $471.08
My monthly payment was significantly lower than my original estimate because my home is $201,000 cheaper than intended.
Over the course of the loan I will pay: $169,588.8 in interest
11721 Roundtree Street Olathe, KS 66061 - $109,900
Loan Value: $102,400
By selling Jenny's car, we only need $102,400 in loan value from the bank which decreases her monthly home payment.
Also, taking the bus helped her monthly budget because she lives close to the bank she works at.
Money left for insurance and taxes on my home: $47,534.7
Also, this leftover money can be used for emergencies. Having a cushion is good incase something happens.