Next week, your friends Abigail and Alexander want to apply to the Third Universal Bank for a mortgage loan. They are considering the purchase of a home that is expected to cost $215,000. Given your knowledge of personal finance, theyve asked for your help in completing the Home Affordability Worksheet that follows. (Note: When completing the form, round each dollar amount to the nearest whole dollar.)
Can Abigail and Alexander Afford This Home Using the Monthly Income Loan Criterion? home that is expected to cost $215,000. Given your knowledge of personal finance, they Worksheet that follows. (Note: When completing the form, round each dollar amount to the nearest whole dollar.) To assist in the preparation of the worksheet, Abigail and Alexander also collected the following information: - Their financial records report a combined gross before-tax annual income of $145,000 and current (premortgage) installment loan, credit card, and car loan debt of $2,115 per month. - Their property taxes and homeowner's insurance policy are expected to cost $2,150 per year. - Their best estimate of the interest rate on their mortgage is 7.5%, and they are interested in obtaining a 15 -year loan. - They have accumulated savings of $50,500 that can be used to satisfy the home's down payment and closing costs. - The lender requires a minimum 20% down payment, and an affordability ratio that ranges from a minimum of 25% to a maximum of 30%. A table of monthly payments (necessary to repay a $10,000 loan) follows: table may also be used in the lower section.) en these results, which statement regarding Abigail and Alexander's mortgage qualification process and their purchase of their $215,000 target le is true? Abigail and Alexander qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion. Abigail and Alexander do not qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion. Can Abigail and Alexander Afford This Home Using the Monthly Income Loan Criterion? home that is expected to cost $215,000. Given your knowledge of personal finance, they Worksheet that follows. (Note: When completing the form, round each dollar amount to the nearest whole dollar.) To assist in the preparation of the worksheet, Abigail and Alexander also collected the following information: - Their financial records report a combined gross before-tax annual income of $145,000 and current (premortgage) installment loan, credit card, and car loan debt of $2,115 per month. - Their property taxes and homeowner's insurance policy are expected to cost $2,150 per year. - Their best estimate of the interest rate on their mortgage is 7.5%, and they are interested in obtaining a 15 -year loan. - They have accumulated savings of $50,500 that can be used to satisfy the home's down payment and closing costs. - The lender requires a minimum 20% down payment, and an affordability ratio that ranges from a minimum of 25% to a maximum of 30%. A table of monthly payments (necessary to repay a $10,000 loan) follows: table may also be used in the lower section.) en these results, which statement regarding Abigail and Alexander's mortgage qualification process and their purchase of their $215,000 target le is true? Abigail and Alexander qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion. Abigail and Alexander do not qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion
