Mortgage Reality

A mortgage is often called the gold standard of good debt. You borrow at relatively low rates to own an asset that has historically appreciated 3-5% per year. And you'd be paying for housing anyway — rent builds zero equity, while every mortgage payment buys you a little more of the home. Over decades, that gap in built wealth tends to be large.

But there's a catch. A mortgage is only "good" debt if you buy within your means. The general rule: keep your housing payment under 28% of gross income. Stretch beyond that, and your "good debt" starts eating into everything else — savings, investing, even basic quality of life.