Thanks for the detailed response. We are fortunate that if we really had an emergency like a lost job and we had to drain our savings, we have family that we know we could lean on until we get back on our feet.

Those are very good points about the high cost of maintenance and repair items. After reading all these comments, a monthly payment of $3400 seems a bit higher than we would want to be stuck with. Cutting back discretionary spending is something I know we could do, but I like the advice of some people here who have said to go a couple months budgeting as if we had that mortgage payment and see how it goes.

One thing we are not taking into account is that I am fortunate enough to be in a very stable government job that gives yearly merit increases of 3-5%. While you can never know for sure what will happen, it is highly likely that my income will only continue to increase.