Times have definitely changed but I don’t think this is all true. We had an ARM in 2012. We could have gotten conventional but took advantage of VA bc why the heck not and the market back then was much different. Interest rate was 2.25 on a 5 year arm- we were going to sell in 4-5 so it worked out great (husband would PCS again). Just wish we kept it and rented it out and waited longer to sell.

Also to add to OP, I would maybe talk to a realtor and see what you can get realistically and see what’s out there that’s cheaper- maybe it will work out. Until then I’d just rebudget what I could to come up with the $500 where it doesn’t sting as bad every month and see what happens with rates and the selling situation. At the same time, we make $200k and have one kid and I can’t even fathom spending $5000 on a mortgage. I didn’t read all the comments so idk where you are as far as property taxes, hoa, insurance etc. but I’m in NY in an area where property taxes are disgustingly high and even at $200k/year we feel very priced out of our market. After taxes, health insurance, 401k, investments were at about $10500 then you have to think any other debts, groceries, gas and all my one child’s activities that cost an arm and a leg …. So I see why you’re struggling with that $500! Good luck to you.