1. Prequalifying for a mortgage Coretta Bradleys sister, Bernice, is getting prequalified for an FHA home mortgage loan. FHA guidelines require qualifying ratios of 29/41. Find the maximum monthly payment allowable. Bernices income: $4,518 monthly salary, $250 monthly alimony, $945 annual interest from investments Housing costs: $1,830 annual property taxes, $498 annual insurance premium, $210 monthly condo maintenance fee Bernices monthly debt: $233.50 car payment, $100 installment loan payment, $25 minimum credit card payment

2. Consider a $50,000 mortgage at 3.5% for 15 years. The closing costs are as follows: origination fee is % of the mortgage, zero points, mortgage insurance of $411, appraisal fee of $520, inspection fees of $100, title insurance fee of $750, recording fees of $85 and an escrow deposit of $735. What is the Real APR? Round to the nearest hundredth of a percent.