Should I buy a $1 million dollar home?

Yes why not. But first you have to confirm that you have many daily based expenses as well like;

• Auto /Transportation expense
• Charitable Donations expense
• Child Care expense
• Clothing expense
• Debt Payments expense
• Entertainment expense
• Groceries / Dining Out expense
• Fitness expense
• Gifts Given (Christmas & birthday gifts, etc.) expense
• Hobbies expense
• Household Maintenance expense
• Insurance other than medical/dental expense
• Investments expense
• Medical/Dental expense
• Miscellaneous expense
• Savings
• Subscription expense
• Utilities expense
• Vacation expense

And many other expenses

And if you have enough income after all these expenses than you should buy a house worth $1M or more

So if you wish to get a mortgage of $1M

1: Your PITI should less than 28% of your gross salary.

PITI is principal: Interest: Taxes: Insurance.

Calculation:

$1,000,000*28/100=$280,000

2: Your DTI should less than 36% of your gross salary.

DTI contains:

Mortgage, credit card payments, child support and other loan payments

Calculation:

$1,000,000*36/100=$360,000

3: Down payment of 20%.

$1,000,000*20/100=$200,000

Remember; down payment directly affect your total amount of mortgage.

More the down payment will minimize the interest rate on mortgage.

According to a survey a person can get a mortgage double or even more than double of his salary, so if you are willing to get a mortgage of 1M your salary or income must be;

$1,000,000/2= $500,000

$1,000,000/2.5= $400,000

Hope this will help you, but if you need more information visit;

http://www.beingarealtor.com

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