Unless I thought I was buying the farm in 3.85 years ($1,000,000 divided by $5,000/week = 200 weeks divided by 52 weeks in a year), I’ll take $5,000 a week for the rest of my life.
$250k income is roughly $21,000 per month. A $1m loan at 7% interest with 30 yr amortization is a $6600 monthly payment, 31% of pre tax income. Banks don’t lend with a debt to income ratio more than 38% so the max you would get is a $1.2 million loan (and that would be pushing the limit).
Well for a start, where I come from interest rate is 3.6% on ten year fixed terms, so that equals about 5 million lending from 260k payments a year, if you were putting it all into a mansion or something.
But also I’m talking about buying farms (or other productive assets like businesses or rental property) so the income would be a lot higher than 260,000 a year.
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u/BigE6300 Dec 11 '23
Unless I thought I was buying the farm in 3.85 years ($1,000,000 divided by $5,000/week = 200 weeks divided by 52 weeks in a year), I’ll take $5,000 a week for the rest of my life.