Calculate the GDS and TDS of the following transaction of Michael Baker and let him know if he is qualified to get a mortgage loan from Bank ABC. GDS=32% and TDS=40% /10pts

Purchase price: $300,000

Down payment $50,000

Mortgage interest 5%

Amortization 20 years

Property taxes: $2200

Heating cost $1400

Credit card: $500 per month

Balance of credit margin (line of credit): $40000

Car loan: $1200 per month

Salary of Michael Baker (Borrower): $125,000

Use the CMHC premium table if necessary!

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