To give you an idea of monthly payments - we borrowed $165,000 at 3.75%. Taxes and insurance are rolled into our payment through escrow. We pay about $2600 in taxes and $600 in insurance each year. Our monthly payment is $1,239. That's more than half of your monthly take home. And that's just PAYMENT, that doesn't include any maintenance. Then you need to consider utilities - water/sewer, electricity, however you may need to heat the house (electricity, propane, gas, fuel oil, whatever). Internet. Cell phone. Car insurance, gas, groceries. I don't see how you can afford a $200k house on the day-to-day even with a $25k down payment.