Can I Afford this Home? Prior to making a mortgage loan, lenders will require a potential borrower to qualify and demonstrate an acceptable credit record and sufficient income to support the loan's scheduled payments. This credit evaluation relies on two basic criteria to determine maximum payment amount, and, relatedly, the maximum total loan and house amount that the borrower can afford, Generally, the guidelines specify a range for each criterion. This practice provides each lender with the flexibility to adapt its requirements to a particular loan applicant. The two borrowing criteria used by most lending institutions are as follows: - The , or maximum allowoble housing expense ratio, which maintains that the applicant's total expenditures for - The income, debt sayment all Next week, your friends Alden and Lel wank to apply to the Fourth Gobal Bank for a mortgage loan. They are considering the purchase of a home that. is expected to cost $155,000. To prevent their possible embarrassment at the bank, and given your knowledge of personal finance, they've asked you to help answer the following questions by completing the home affordability worksheet that follows: - What is the minimum and maximum annual housing expense allowable by the bank, given Alden and Lei's combined aninusl income? - What is the minimum and maximum total monthly debt obligation allowable by the bank, given Aiden and Leis combined monthly - Given their existing debt obligations, what is the maximum additional mortgage obligation that Aiden and Lei can reasonably expect the bank to consider next week? To assist in the preparation of the worksheet, Aiden and Lel have collected the following information: - Their financial records report a combined gross, before tax, annual income of $145,000, and current (pre-mortgage) installment loan, credit card and car loan, debt of $2,115 per month. - Their best estimate of the interest rate on the new mortgage is 7.5%, and they are interested in obtaining a 15 -year loan. - They have accumulated savings of $38,500 that can be used to satisfy the home's down payment and closing costs. - The lender requires a minimum 20% down payment. Note: When completing the form, found each dollar amount to the nearest whole dollar. Unless labeled differently, all of the values in the worksheet represent dollar amounts. Also, this problem contains additional information that may not be necessary to generate your solutions to the questions. Note: When completing the form, round each dollar amount to the nearest whole dollar. Unless labeled differently, all of the values in the worksheet. represent dollar amounts. Also, this problem contains additional information that may not be necessary to generate your solutions to the questions