Rachel and Alexander Harrison need to calculate the amount they can afford to spend on their first home. They have a combined annual income of $67,500 and have. $37,000 available for a down payment and closing costs. The Harrisons estimate that homeowner's insurance and property taxes will be $125 per month. They expect the mortgage lender to use a 28 percent (of monthly gross income) mortgage payment affordability ratio, to lend at an interest rate of 6 percent on a 30-year mortgage, and to require a 20 percent down payment. Based on this information, use the home affordability analysis form in Worksheet 5.3 to determine the highest-priced home the Harrisons can afford. Assume that closing costs are one- half of the down payment. Round the answer to the. nearest dollar