Their financial records report a combined gross before-tax annual income of $145,000 and current (premortgage) installment loan, credit card, and car loan debt of $2,115 per month. Their property taxes and homeowner's insurance policy are expected to cost $1,838 per year Their best estimate of the interest rate on their mortgage is 7.5%, and they are interested in obtaining a 15-year loan. They have accumulated savings of $56,500 that can be used to satisfy the home's down payment and closing costs. The lender requires a minimum 20% down payment, and an affordability ratio that ranges from a minimum of 25% to a maximum of 30%. A table of monthly payments (necessary to repay a $10,000 loan) follows: Loan Maturity Interest Rate (%) 10 Years 15 Years 5.0 106.0655 79.0794 20 Years 65.9956 25 Years 30 Years 58.4590 53.6822 5.5 100.5263 81.7083 68.7857 51.4087 56.7789 5.0 111.0205 84.3857 71.6431 54.4301 59.9551 6.5 113.5480 87.1107 74.5573 57.5207 63.2068 7.0 116.1085 89.8525 77.5299 70.6779 66.5302 7.3 118.7018 92.7012 80.5593 5.0 121.3276 95.5652 83.6440 73.8991 69.9215 77.1816 73.3765 8.5 123.9657 95.4740 86.7823 9.0 126.6758 101.4257 89.9726 80.5227 83.9195 80.4623 76.8913 2.5 10.0 129.3976 104.4225 93.2131 132.1507 107.4605 96.5022 57.3597 90.8701 84.0854 87.7572 (Note: Unless labeled differently, all of the following values represent dollar amounts. Also, some values calculated or used in the upper section of the table may also be used in the lower section) Home Affordability Worksheet Based on Monthly Income 1. Annual income 2. Monthly income 3. Lender's monthly income affordability ratio 4. Maximum monthly mortgage payment (PITI) 5. Estimated monthly property tax and insurance payment 6. Maximum monthly loan payment (P and I only) 7. Expected interest rate 8. Planned loan maturity (years) 9. Mortgage payment factor per $10,000 (from the Loan Maturity table) 10. Maximum loan based on monthly income 11. Funds Available for a Down Payment and Closing Costs 12. Required (20%) Down Payment 13. Maximum Purchase Price Based on Monthly Income High Value Low Value Amount 30% 25% 7.5% 15 Given these results, which statement regarding Josh and Ma's mortgage qualification process and their purchase of their $245,000 target home is Josh and Mia do not quality to purchase their $245,000 target home according to the Monthly Income Affordability Worksheet criterion. Josh and Mia qualify to purchase their $245,000 target home according to the Monthly Income Affordability Worksheet criterion.