Over the weekend, I was talking with a friend about the status of our house. When discussing mortgages and down payments, she asked in amazement, “How did you save all of that?” It’s a valid question since Chicago has a higher cost of living and we’re putting down 20%. The short answer is that we’re savers and that we’re very fortunate. John and I are extremely fortunate that we don’t have any student loans. So a huge “thank you” goes out to our very generous and fiscally chic parents. Plus, scholarships paid for some of our college education.
We’re also lucky that this is home buyer’s market. Home prices in the Chicago area hit a new low in December 2010 since the market’s peak in 2006, falling 30 percent as compared to March 2002. Mortgage rates are at a 60 year low. To put things in perspective, our 30 year fixed mortgage is at 4.875%. My Mom said the lowest rate they ever got was 7%. Plus, we’re only buying as much house as we want and need. We could afford a larger or more expensive home, but have no desire for that. A smaller house leads to a smaller mortgage, smaller down payment, and smaller monthly payment.
As for being savers, we like to “think of the savings.” John may have coined the phrase, but it’s been mastered by one of John’s close friends from college. He likes to wave his arms emphatically when “thinking of the savings.” In order to protect the innocent, he’ll remain anonymous. Though I couldn’t resist posting his picture from one of John’s Nerd Parties.
Stay tuned for more ways to “Think of the Savings.”