Quote:
Originally Posted by OldDutch
I read in the article a household income of $100K can qualify for $700K mortgage. Wow.
Is a family completely house poor at that point? How do they afford cars, kids, utilities, repairs, vacations, etc.
Pretty obvious debt is the solution. I can start to see how this is getting dangerous here in Canada. People at that income should not be spending that on a mortgage period. Just a totally dangerous situation.
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It's been a while since I've done a bank mortgage but I suspect that the real answer is no, most people do not qualify in that scenario. Like if you have perfect credit and no other debt you would qualify for that. So if you have car payments, other utility costs, kids/vacation debt, then there is no way you would qualify for that amount.
I think the debt we're creating as a country comes largely after qualifying for a mortgage. We're creating secondary financing debt...HELOC's, second mortgages, refinancing without reassessing the house.