Seth and Alexandra Moore of Elk Grove Village, Illinois have an annual income of $105,000 and want to buy a home. Currently, mortgage rates are 4.5 percent. The Moores want to take out a mortgage for 30 years. Real estate taxes are estimated to be $4,560 per year for homes similar to what they would like to buy, and homeowner's insurance would be about $1,260 per year.

1. Using a 28 percent front-end ratio, what are the total annual and monthly expenditures for which they would qualify? Round your answers to the nearest dollar.

   Total annual expenditures	$
   Monthly expenditures	$

2. Using a 36 percent back-end ratio, what monthly mortgage payment (including taxes and insurance) could they afford given that they have an automobile loan payment of $480, a student loan payment of $350, and credit card payments of $240? (Hint: Subtract these amounts from the total monthly affordable payments for their income to determine the amount left over to spend on a mortgage.) Round your answer to the nearest dollar.

   $

3. Using a 36 percent back-end ratio, if the Moores had zero debt, what monthly mortgage payment (including taxes and insurance) could they afford? Round your answer to the nearest dollar.

   $

Mortgage Affordability Seth and Alexandra Moore of Elk Grove Village, Illinois have an annual income of $105,000 and want to buy a home. Currently, mortgage rates are 4.5 percent. The Moores want to take out a mortgage for 30 years. Real estate taxes are estimated to be $4,560 per year for homes similar to what they would like to buy, and homeowner's insurance would be about $1,260 per year. a. Using a 28 percent front-end ratio, what are the total annual and monthly expenditures for which they would qualify? Round your answers to the nearest dollar. " Total annual expenditures Monthly expenditures b. Using a 36 percent back-end ratio, what monthly mortgage payment (including taxes and insurance) could they afford given that they have an automobile loan payment of $480, a student loan payment of $350, and credit card payments of $240? (Hint: Subtract these amounts from the total monthly affordable payments for their income to determine the amount left over to spend on a mortgage.) Round your answer to the nearest dollar. c. Using a 36 percent back-end ratio, if the Moores had zero debt, what monthly mortgage payment (including taxes and insurance) could they afford? Round your answer to the nearest dollar