Comments: My Formula for Buying a House

Recently, I received this valuable comment on my post titled My Formula for Buying a House:

You're spot on with your advice. My wife and I bought our first house in 1994. We made extra payments for a while, and then re-financed to a fifteen year loan. We had paid the mortgage down quite a ways and had only nine years remaining (though we could have finished in four) when we stumbled upon our dream house.

Now this house really is our dream house, but it cost us a pretty penny to get it. Our current mortgage costs us nearly double what we were paying each month before. And it's a thirty year mortgage. Two years ago, I wasn't as well-educated about personal finance, or I probably wouldn't have made this choice. Sometimes I regret the purchase because it will be some time before we can begin making extra payments or refinance to a shorter term. (Mostly I'm glad we have the house, though -- it's like living in a paradise.)

Part of being frugal and building long-term wealth is learning to be satisfied with what you have, and being satisfied with your house can make a HUGE difference.

Very good points here. This is a real-life case of what I was describing. And while this commenter isn't in the dire financial straits I see many in, he certainly is constrained a bit because of stretching to buy a big house.

And he's VERY right on the last comment. If you can be satisfied with a "good" house (versus a dream/huge/large house), it will have a major, positive impact on your finances.

Comments

[Kyle]

Those are good points. I'm doing the same, except we're growing out of the home we're moving out of into a dream home. Living in a home you love makes a huge difference in your happiness, so as long as you can afford it, I would get that dream home. If you have to stretch, don't do it.

[J.D. @ Get Rich Slowly, from the above-mentioned expensive dream house]

Hm. That comment looks familiar. :)