Five years have passed and Jamie Lee, 34, is considering taking the plunge--not only is she engaged to be married, but she is also deciding on whether to purchase a new home.

Jamie Lees cupcake caf is a success! It has been open for over a year now and has earned itself rave reviews in the local press and from its regular customers who just cannot get enough of her delicious varieties of cupcakes. One such customer, who stopped by on a whim in the cafs first week of business, is Ross. After a whirlwind courtship, Ross, a self-employed web designer, proposed, and Jamie Lee agreed to be his wife.

The bungalow that Jamie Lee has been renting for the past five years is too small for the soon-to-be newlyweds, so Jamie Lee and Ross have found a brand new three-bedroom, 2 bath home in a quiet neighborhood for $277,000.

Their neighborhoods homeowners association dues would be $396.00 a year. After paying a years worth of house payments, their equity will be $6,500. Based on Jamie Lee and Ross income, they fall into a 20% tax rate bracket. Use this payment information along with the information below to compare the costs of renting and buying a house.

1) what is the annual morgage payments

2) what are the annual property taxes

3) what is the homeowners insurance

4)what is th estimated maintenacne and repairs

5) what is the after-tax interest lost because of down payment/ closing costs

less: financial benefits of homeownership

6) what is the growth in equity

7) what are the tax savings for morgage interest ( annual morgage interest* tax rate)

8) what are the tax savings for property taxes ( annual property taxes * tax rate)

9) what is the estimated annual appreciation