The total monthly payment for a home mortgage loan is affected by the property tax and insurance. This amount is around 15% of the principal plus interest payment that you calculated in the previous problem. Moreover, as a rule of thumb, a family should not devote more than 28% of its gross income for home loan payments. With this information, find the amount that a family must earn to afford a $200,000 mortgage loan using the APRs of the previous problem.

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A B APR Monthly (%) Payment 0 4 8 12 0 C Total Payment (1.15 x Column B) D Annual Payment (12 x Column C) E Minimum Annual Income (Column D/ 0.28)