need to ulate the they can an annual income of $67,500 and have $37,000 available for a down payment and closing costs. The Harrisons estimate that homeowner's insuran property taxes will be $250 per month. They expect the mortgage lender to use a 30 percent (of monthly gross income) mortgage payment aff ratio, to lend at an interest rate of 6 percent on a 30-year mortgage, and to require a 10 percent down payment. Based on this information, us home affordability analysis form in Worksheet 5.3 to determine the highest-priced home the Harrisons can afford. Assume that closing costs an of the down payment. Round the answer to the nearest dollar.

need to ulate the they can an annual income of $67,500 and have $37,000 available for a down payment and closing costs. The Harrisons estimate that homeowner's insuran property taxes will be $250 per month. They expect the mortgage lender to use a 30 percent (of monthly gross income) mortgage payment aff ratio, to lend at an interest rate of 6 percent on a 30-year mortgage, and to require a 10 percent down payment. Based on this information, us home affordability analysis form in Worksheet 5.3 to determine the highest-priced home the Harrisons can afford. Assume that closing costs an of the down payment. Round the answer to the nearest dollar.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Rachel and Alexander Harrison need to calculate the amount they can afford to spend on their first home. They have a combined annual income of $67,500 and have $37,000 available for a down payment and closing costs. The Harrisons estimate that homeowner's insurance and property taxes will be $150 per month. They expect the mortgage lender to use a 28 percent (of monthly gross income) mortgage payment affordability ratio, to lend at an interest rate of 6 percent on a 30-year mortgage, and to require a 10 percent down payment. Based on this information, use the home affordability analysis form in Worksheet 5.3 to determine the highest-priced home the Harrisons can afford. Assume that closing costs are one-half of the down payment. Round the answer to the nearest dollar. $
Your friend is currently paying $734 in rent monthly in Fort Wayne and would rather apply the payment toward purchasing a home. If she can get a 30 year mortgage at 4.67% APR using her current payment amount, how much could she borrow? What could you type into Excel to calculate this value?
Before you are able to purchase a home you need to get pre-qualified and determine the maximum amount you can afford for the mortgage payment. The mortgage company that you visit uses the qualifying ratios 29/41. After speaking with the mortgage broker and answering several questions, the broker compiles this information regarding your income and expenses: You have a monthly income of $5,500. Your significant other that is living with your and will be on the loan earns $4,500 monthly. You have 2 car payments, one is $325 and the other is $280. Your significant other has a motorcycle payment of $450. You have a credit card payment of $25. Your significant other has a credit card payment of $180. The annual property tax in the area that you are considering to purchase the house has an average amount of $2800, while the average home insurance is $800 annually. Determine the anticipated monthly payment of the mortgage based on the given ratios. A) The Front-End (AKA: Housing) Ratio: ? B)…
A young couple decide to take advantage the current first-time home buyer credit and buy a new house. With their combined income, they can afford to make a maximum of $550 monthly payment. With their credit history, they can borrow a 30-year fixed rate mortgage loan at 6.0% (mortgage loans compound monthly). What's the maximum amount they can borrow?
Michelle Duncan wants to know what price home she can afford. Her annual gross income is $49,800. She owes $840 per month on other debts and expects her property taxes and homeowners insurance to cost $310 per month. She knows she can get an 9.50%, 30-year mortgage so her mortgage payment factor is 8.41. She expects to make a 25% down payment. What is Michelle's affordable home purchase price? (Round your answer to the nearest dollar amount.)
Chelsea and Bill are buying a house on a 30-year mortgage. They can afford a $1200 per month mortgage payment. If their loan as an interest rate of 4.25%, what is the maximum purchase price of a house that they can afford?
The Bainters want to estimate annual costs for purchasing the home so they can compare them with the costs they estimated for renting. These costs are expenses the Bainters will have only if they purchase instead of rent: monthly mortgage payment $200 per year for HOA fees $1,750 per year for property taxes $1,950 per year for home maintenance $75 per month for water and sewer services $10 per month for trash and recycling services $65 per month for internet $110 per month for homeowners' insurance Approximately how much should the Bainters budget for a year? Your answer should include the total amount the Bainters should budget the calculations or an explanation of how you determined the answer
A young married couple decide to take advantage the current first-time home buyer credit and buy a new house. With their combined income, they can afford to make a maximum of $850 monthly payment. With their credit history, they can borrow a 30-year fixed rate mortgage loan at 6.8% (mortgage loans compound monthly). What's the maximum amount they can borrow?
Bonnie and Claude want to buy a house. They can afford monthly payments of $1125.00. The bank offers them a mortgage at an interest rate of 3.10%, compounded semi-annually, with an amortization period of 25 years. a) What is the maximum amount of money the bank will lend them for their mortgage? Show your work. b) If they have $30,000 saved for a down payment, what is the maximum house price they can afford?
Donald and Alex have a combined gross monthly income of $5500. They want to buy a house in a neighborhood where the average monthly heating cost is $200 and monthly property taxes are $325. a) Calculate the maximum monthly mortgage payment they can afford, based on the gross debt service ratio. Show your work. b) Based on the maximum monthly mortgage payment in a), their bank has offered them a 25 year mortgage at an interest rate of 3.5%, compounded semi-annually. If they saved $20,000 for a down payment, what would be the maximum house price they can afford? Show your work.
A couple wants to purchase a new house and feel that they can afford a mortgage payment of $600 a month. They are able to obtain a 30-year 7.4% mortgage (compounded monthly) but must put down 20% of the cost of the house. Assuming that they have enough savings for the down payment, how expensive a house can they afford? The couple can afford a house that costs up to $ ☐ . (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.)
Felipe and Suzie want to calculate the difference in monthly payments on a $110,000 home as a result of a $5,000 down payment or a $10,000 down payment. Calculate the monthly payments, assuming they get 5%, 30-year mortgage.

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