Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Technical Analysis Of The Financial Markets

Authors: John J. Murphy

1st Edition

0735200661, 978-0735200661

More Books

Students also viewed these Finance questions

Question

Identify HRM systems, practices, and policies.

Answered: 1 week ago