Estimate the affordable monthly mortgage payment, the affordable mortgage amount and the affordable home purchase price for the following situation (Refer to Exhibit 9.8 and Exhibit 9-9) (Round time value factor to 2 decimal places, intermediate and final answers to the nearest whole number.) Monthly cross income Down payment to be made (percent of purchase price) other debt (monthly payment) Monthly estimate for property taxes and insurance 30-year loan Mortgage costs 4,375 20 Percent $ 240 $ 275 6.0 Percent ho Affordable Amount Affordable monthly mortgage payment Affordable mortgage amount Affordable home purchase price Exhibit 9-8 Housing affordability and mortgage qualification amounts Example A Examples Stept Determine your monthly $48,000 -12 548,000 - 12 gross Income (annual income divided by 12) Step 2 With o down payment of at $4,000 $4,000 least 5 percent, lenders use 39 33 33 percent of monthly gross income as a guideline for $1520 31,320 PITI (principal, interest, taxes, and insurance) and 38 percent of monthly gross income as a guideline for PITI plus other debt payments Step 3: Subtract other debt -380 payments (eg, payments on -300 -300 an auto loan) and an estimate of the monthly costs of property taxes and homeowner's Insurance () Affordable monthly mortgoge S 840 $1020 payment Step 4: Divide this amount by the $7.34 -S734 monthly mortgage payment $1,000 $1.000 per $1,000 based on current mortgage rates-on 8 percent, 30-year loan, for example (see Exhibit 9-90) and multiply by $1,000 (b) Affordoble mortgoge amount $114,441 $138.965 Step 5: Divide your affordable 9 mortgage amount by 1 minus the fractional portion of your down paymente: 0.1-1 with a 10 percent down payment (c) Affordable home purchase price 5127157 $154,405 The engage the Term Rato 30 Years 25 YoRTS 20 Years 15 Yaars 3.09 $4.22 $4.74 $5.55 $6.91 3.5 4.49 5.01 5.80 7.15 4.0 4.77 5.28 6.06 740 4.5 5.07 5.56 6.33 7.65 5.0 5.37 5.85 6.60 7.91 5.5 5.68 6.14 6.88 8.17 6.0 6.00 6.44 7.16 8.43 6.5 6.32 6.67 7.45 8.71 7.0 6.65 7.06 7.75 8.98 7.5 6.99 7.39 8.06 9.27 8.0 7.34 7.72 8.36 9.56 0000 8.5 769 8.05 8.68 9.85