Directions: Answer all questions. While you may use your calculator, be sure to show what calculations you do in the spil sure you fill out the summary sheet on the last page. 1. Before you buy a house, you should have a job. List the job that you think you will have or would like to have when you finish your education: Accountant 2. You need to know about how much money you will make annually. You may use the following directions, find a website of your own, or use other references. Provide documentation. a) Go to the website jobstar.org/tools/salary. b) Click on salary surveys link. c) Click on profession-specific salary surveys link. If you could not find your listed profession, you may choose to use another website to provide you with the information. d) Find your occupation and click on it. c) When you find the salary of this occupation, print out that page, circle or highlight the salary and write the annual salary below. (Please print out only the one page you need.) $60,377 >60,000 3. Next you must figure out the affordability guidelines the house. a) What is the maximum price you can afford on the salary you will make? b) What is the low end) monthly expense that you will able to afford? 4. Now you need to find a house to fit these guidelines. There are many internet sites you may choose from. One suggestion is www.timesunion.com if you wish to buy a house in the capital district. Print out the house information and a picture of the house that fits the price range you calculated in number 3 and write the cost below: 5. You will make a standard down payment. How much is that? 6. What amount will you have to borrow from the bank? 7. Check a newspaper (or go on-line) for the current mortgage rates. Either cut out the advertisement or print out the page with the rates. Circle the rates you choose to use. Name of lending institution: Mortgage rate: 15 years: Round to the nearest half percent: Mortgage rate: 30 years: Round to the nearest half percent: (Your two rates may be the same.) 8. Use the mortgage table provided to you in class to find the monthly payment if you are taking out a 15 year mortgage. If your rate is lower than any on the table, use the lowest rate listed. 9. Find the total amount you will pay for this house, including the down payment. 10. Using your answer to number 9, how much of that amount is interest? 11. Use the mortgage table inside the front cover in your text to find the monthly payment if you are taking out a 30 year mortgage. If your rate is lower than any on the table, use the lowest rate listed 12. Find the total amount you will pay for this house, including the down payment. 13. Using your answer to number 12, how much of that amount is interest? 14. The cost of homeowners' insurance is $1150 per year. Real estate taxes are 1.75% of the cost of the house per year. Find the total cost per month of these two expenses. 15. What is your total payment per month for the 15 year loan? (Include mortgage, insurance and taxes.) 16. What is your total payment per month for the 30 year loan? (Include mortgage, insurance and taxes.) 17. Assuming you can afford the low end payments that you calculated in 3b), can you afford: the 15 year mortgage? YES NO the 30 year mortgage? YES NO 18. Suppose you could afford both the 15 and 30 year mortgage, which one would you choose and give one reason 19. Assuming that you couldn't afford either the 15 or 30 year mortgage, name two things you could do if you still wanted to buy this house. Summary Sheet: Transfer the final answers from your project to the sheet below: problem description your answer number 3a max price 3b low end (afford) 4 house cost 5 down payment 6 amount borrowed 7 15 year rate 30 year rate 8 15 yr monthly payment 9 15 yr total 10 15 yr interest amount 11 30 yr monthly payment 12 30 yr total paid 13 30 yr interest amount 14 insurance and taxes 15 15 yr total payments 16 30 yr total payments 17 afford 15 yr mortgage? afford 30 yr mortgage? Directions: Answer all questions. While you may use your calculator, be sure to show what calculations you do in the spil sure you fill out the summary sheet on the last page. 1. Before you buy a house, you should have a job. List the job that you think you will have or would like to have when you finish your education: Accountant 2. You need to know about how much money you will make annually. You may use the following directions, find a website of your own, or use other references. Provide documentation. a) Go to the website jobstar.org/tools/salary. b) Click on salary surveys link. c) Click on profession-specific salary surveys link. If you could not find your listed profession, you may choose to use another website to provide you with the information. d) Find your occupation and click on it. c) When you find the salary of this occupation, print out that page, circle or highlight the salary and write the annual salary below. (Please print out only the one page you need.) $60,377 >60,000 3. Next you must figure out the affordability guidelines the house. a) What is the maximum price you can afford on the salary you will make? b) What is the low end) monthly expense that you will able to afford? 4. Now you need to find a house to fit these guidelines. There are many internet sites you may choose from. One suggestion is www.timesunion.com if you wish to buy a house in the capital district. Print out the house information and a picture of the house that fits the price range you calculated in number 3 and write the cost below: 5. You will make a standard down payment. How much is that? 6. What amount will you have to borrow from the bank? 7. Check a newspaper (or go on-line) for the current mortgage rates. Either cut out the advertisement or print out the page with the rates. Circle the rates you choose to use. Name of lending institution: Mortgage rate: 15 years: Round to the nearest half percent: Mortgage rate: 30 years: Round to the nearest half percent: (Your two rates may be the same.) 8. Use the mortgage table provided to you in class to find the monthly payment if you are taking out a 15 year mortgage. If your rate is lower than any on the table, use the lowest rate listed. 9. Find the total amount you will pay for this house, including the down payment. 10. Using your answer to number 9, how much of that amount is interest? 11. Use the mortgage table inside the front cover in your text to find the monthly payment if you are taking out a 30 year mortgage. If your rate is lower than any on the table, use the lowest rate listed 12. Find the total amount you will pay for this house, including the down payment. 13. Using your answer to number 12, how much of that amount is interest? 14. The cost of homeowners' insurance is $1150 per year. Real estate taxes are 1.75% of the cost of the house per year. Find the total cost per month of these two expenses. 15. What is your total payment per month for the 15 year loan? (Include mortgage, insurance and taxes.) 16. What is your total payment per month for the 30 year loan? (Include mortgage, insurance and taxes.) 17. Assuming you can afford the low end payments that you calculated in 3b), can you afford: the 15 year mortgage? YES NO the 30 year mortgage? YES NO 18. Suppose you could afford both the 15 and 30 year mortgage, which one would you choose and give one reason 19. Assuming that you couldn't afford either the 15 or 30 year mortgage, name two things you could do if you still wanted to buy this house. Summary Sheet: Transfer the final answers from your project to the sheet below: problem description your answer number 3a max price 3b low end (afford) 4 house cost 5 down payment 6 amount borrowed 7 15 year rate 30 year rate 8 15 yr monthly payment 9 15 yr total 10 15 yr interest amount 11 30 yr monthly payment 12 30 yr total paid 13 30 yr interest amount 14 insurance and taxes 15 15 yr total payments 16 30 yr total payments 17 afford 15 yr mortgage? afford 30 yr mortgage