The Wilmoth's plan to purchase a house but want to determine the after tax cost of financing its purchase. Given their projected taxable income, the Wilmoth's are in the 24% Federal income tax bracket and the 8% state income tax bracket (i.e., an aggregate marginal tax bracket of 32%). Assume that the Wilmoth's will benefit from itemizing their deductions for both Federal and state purposes. The total cash outlay during the first year of ownership will be $23,400 ($1,200 principal payments, $22,200 qualified residence interest payments). Determine the initial year after-tax cost of financing the purchase of the home