Next week, your friends Amy and Van 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 $$125,000.$ Given your knowledge of personal finance, they$$ve asked for your help in completing the Home Affordability Worksheet that follows.

To assist in the preparation of the worksheet, Amy and Van also collected the following information:

$$ Their financial records report a combined gross before$-$tax annual income of $$105,000$ and current $($pre$-$mortgage$)$ installment loan, credit card, and car loan debt of $$1,531$ per month.

$$ Their property taxes and homeowner$$s insurance policy are expected to cost $$2,813$ per year.

$$ Their best estimate of the interest rate on their mortgage is $7\mathrm{.}5\%,$ and they are interested in obtaining a $15-$year loan.

$$ They have accumulated savings of $$32,500$ that can be used to satisfy the home$$s down payment and closing costs.

$$ The lender requires a minimum $20\%$ down payment, and installment loan affordability ratios that range from a minimum of $33\%$ to a maximum of $38\%.$