<prompt> Human: I hope this is the right sub, Ill dive right in, I make about 70k a yeara little more but Im rounding down and am finally thinking about buying a home. I am currently renting and paying 1200 a month.average rent where I live single and living alone, dont like roommates. Im thinking about buying a home, Itll probably be in a duplex or a condo and was approved for 250k max but with my budget, I dont plan on going over 200k. The estimates I have seen, show Ill be paying about 1000 a month on the loan with around 4 int.rounding up, Ill only be putting down 10 or lower if doing a FHA loan. So I have 20k saved up and additional 5k for closing costs. this will allow me to not dive into my 8 month emergency money. I can do 20 down but I will be diving into my emergency fund which I simply dont feel comfortable with. So Ill have PMI, taxes, and insurance built into the loan. lets assume thats 200 more per month. total coming to 1200. Am I doing this correctly? I plan to be in the city for the foreseable 10 years future so I think Ill be better off buying rather than renting. I guess there really isnt a question in there I just wanted to run it by everyone to make sure my thought process was correct and that I could afford a home of this value.  <response>: Ill only be putting down 10 or lower if doing a FHA loan.You and everyone else keep talking about PMI, which is private mortgage insurance. The FHA is public mortgage insurance, essentially. The difference between PMI and FHA is important, so please dont think of them as being interchangeable. When you have PMI, you can cancel your monthly premiums once your equity reaches 80. You cant get rid of FHA monthly premiums unless and until you refinance into a conventional non-FHA, non-VA loan. If you get an FHA loan, youll have to refinance later to get rid of the mortgage insurance premiums, and pay another set of closing costs -- and possibly with a higher interest rate, because rates are at historical lows right now and theyll probably be higher in a few years.On a 180,000 FHA loan with a down payment of 5 or more, but less than 20, the monthly mortgage insurance is 120 Are your taxes, insurance and condo fees really going to total 80 more than that lets assume 200 more per month?On the other hand, PMI probably will cost more per month than FHA would. But you can cancel it eventually, without refinancing.Make sure youre accurately estimating those monthly costs of ownership. 