I just published a blog post called First-Time Homebuyer Mistakes: The Mortgage Math Most Buyers Skip, and it’s easily the longest thing I’ve put on the studio site so far. It took about six hours of writing and rewriting to get right. Which is a strange thing to spend a week on, because I’m not currently in the market to buy a house.
So why bother?
Two reasons. The first one is obvious — I sell a Home Buying & Mortgage Workbook, and the post is the kind of top-of-funnel content that actually drives traffic to a product page without reading like a pitch. People searching “first-time homebuyer mistakes” aren’t looking for my spreadsheet yet. They’re looking for honest answers. If I give them honest answers, a small percentage will notice the spreadsheet at the bottom and go, “oh — I could run all of this in one file.” That’s the whole game.
But the second reason is the one that actually made me sit down and write it.
The more I dug into the math most first-time buyers skip, the angrier I got. Not at the buyers. At the system.
Every online mortgage calculator leads with the monthly principal and interest payment because that’s the smallest, most digestible number. It’s also structurally incomplete. Principal and interest is usually 55% to 65% of what you’ll actually pay each month once you add property taxes, insurance, PMI, HOA fees, utilities, and maintenance reserves. On a $350,000 house, the “monthly payment” your lender quotes you and the monthly payment your bank account experiences can be a thousand dollars apart.
A thousand dollars a month. For thirty years. On the biggest purchase of most people’s lives.
And the calculators that told you $2,041 when the real number was $3,200 aren’t broken. They’re working exactly as designed. They’re designed to produce a number that makes you feel like you can afford the house, so you’ll click “get pre-approved” and become a lead.
That’s fine. That’s capitalism. But it’s worth naming out loud.
The 28/36 rule is the other one that got me. It’s the most-cited affordability guideline in real estate — your housing costs shouldn’t exceed 28% of your gross monthly income, and your total debt payments shouldn’t exceed 36%. Every real estate site repeats it. Every lender uses some variant of it.
The problem is that it assumes your gross income is a reliable proxy for what’s available to spend. If you’re a W-2 employee with no student loans and a stable emergency fund, fine. If you’re self-employed, paying down $40,000 in student debt, routing 15% of your paycheck to retirement because you’re behind, paying for childcare, and living in a state with high income tax — the 28/36 rule tells you that you can afford more house than you actually can.
And the lender will approve you for it. Because the lender’s formula is asking a different question — “can this borrower make the payment?” — not “will this borrower have any money left after the payment is made?”
Those are not the same question.
I wrote the post because once I saw the pattern, I couldn’t stop seeing it. Every first-time buyer mistake I listed has the same underlying cause: the information needed to avoid it exists, but nobody presents it as a connected system. You Google one thing and get one answer. You Google the next thing and get a different answer that doesn’t reconcile with the first one. You ask your lender and they answer the question you asked, not the question you needed to ask. By the time you close, you’ve made a hundred small decisions on incomplete information, and any one of them could be costing you tens of thousands of dollars over the life of the loan.
That’s what a good spreadsheet solves. Not because spreadsheets are magic, but because a spreadsheet is the only tool where you can put every variable in one place and watch them update in real time as you change your assumptions. That’s what the Home Buying & Mortgage Workbook is. Fifteen tabs covering affordability, full PITI, 3-loan comparison, closing costs, rent-vs-buy, and extra payment impact — all wired up so changing one number on the Control Panel flows to every downstream calculation at once.
And before anyone asks — yes, I built the whole thing before I wrote the blog post, not the other way around. The post is what came out of me realizing that most people don’t even know these calculations exist, let alone that they should all be connected.
The thing I keep learning, running this studio, is that the product is only half of what I’m building. The other half is the context someone needs to understand why the product matters. A budget spreadsheet or a mortgage workbook isn’t useful on its own — it’s useful because it replaces a broken way of thinking about money with a better one. And the only way to make that case is to write about it honestly, in public, at length, without hedging.
So that’s what I did this week.
Read the full post here if you want the whole thing:
First-Time Homebuyer Mistakes: The Mortgage Math Most Buyers Skip →
It’s about 11 minutes. There’s a comparison table in there I’m particularly proud of — a $300,000 mortgage, 6.75% interest, and what happens to your total interest cost when you throw an extra $100, $250, or $500 a month at the principal. The short version: adding $250 a month saves you $108,000 in interest and knocks 8 years off the loan. Most buyers never run that calculation because no one ever puts it in front of them.
Now it’s in front of you.
— Josh
Budget smarter. Create better. Plan further.
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