Tracey would like to purchase a condo worth $450,000 with condo fees (including utilities) of $400/mo.,

annual taxes of $1,800 and closing costs of $4,500.

She works as a Marketing Coordinator earning $84,000/yr. gross income (net income $59,000)

Her expenses include rent ($1,500/mo.),

food & clothes ($500/mo.),

cell & intranet ($100/mo.),

gym membership ($50/mo.),

travel/entertainment ($200/mo.,

miscellaneous ($150/mo.) Assets include: a car ($10,000),

RRSPs ($30,000)

, a savings account ($20,000)

and a recent inheritance of $50,000

Liabilities include: a car loan ($150/mo., $2,000 outstanding), a credit card with a $10,000 limit paid in full monthly. Based on the information above show your calculations for each of the following questions:

A) Calculate Traceys current monthly cash flow B) In order to purchase the condo, first, determine 2 down payment options for Tracey (high ratio & conventional). How much would the down payment be for each option and where would Tracey get the money from? C) Calculate Traceys monthly mortgage payment if she had a conventional mortgage on her new condo and selected a 5-year term at a fixed rate of 3.85%, with a 25 year amortization D) Calculate Traceys Gross Debt Service Ratio if she owned the condo E) Calculate Traceys Total Debt Service Ratio if she owned the condo F) If Tracey had a good credit score do you think she would be approved for this mortgage? Why?