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Suppose a single man has an annual income of $84,000. Interest rates are at 4% for a 30 year LPM (factor = .0047742), lenders require
Suppose a single man has an annual income of $84,000. Interest rates are at 4% for a 30 year LPM (factor = .0047742), lenders require a down payment of 5%, PMI costs .78% of the OLB (divide by 12 for monthly payment) and insurance and taxes amount to 3.2% of the home value annually. He pays $1,550 per month to cover other debt obligations. Using a back ratio (DTI ratio) of 43%, he can afford a home priced at:
A. $249,600
B. $210,278
C. $185,936
D. $179,809
E. $129,171
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