Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The day after signing your brokerage contract, your clients ask you to find a property suitable for the needs of his wife and himself. Before

image text in transcribed
The day after signing your brokerage contract, your clients ask you to find a property suitable for the needs of his wife and himself. Before committing, they want to know their maximum purchasing capacity that they can expect. Here is the information that the purchasers have given you: Gross salary of Mr. Buyer: $98,000 Gross salary of Mrs. Buyer : $46,000 Yearly municipal taxes in this area: $5,400 Yearly school taxes in this area : $1,200 Annual heating and electricity costs: $2,400 Monthly car loan payments: $400 Credit card - Limit $5,000, Balance So (3% minimum) Nominal interest rate and amortization period: 3% and 20 years Qualification rate and amortization period: 5.5% and 25 years Debt Amortization Coefficients: Gross debt service ratio (GDSR): 32% Total debt service ratio (TDSR): 40% For the Down payment: Purchasers have been saving $1,000 per month for the past 10 years at a rate of 5% compounded monthly. The maturity of the investment comes to term at the end of the current month and they dispose of this amount for the purchase of their new property. CMHC insurance premium: The buyers do not want to subscribe to an insured mortgage loan and have the sufficient minimum funds to obtain a conventional mortgage loan. The maximum purchase price according to their salary and down payment is: (2 points) $5467 $63, SOP 254 14 Netton The day after signing your brokerage contract, your clients ask you to find a property suitable for the needs of his wife and himself. Before committing, they want to know their maximum purchasing capacity that they can expect. Here is the information that the purchasers have given you: Gross salary of Mr. Buyer: $98,000 Gross salary of Mrs. Buyer : $46,000 Yearly municipal taxes in this area: $5,400 Yearly school taxes in this area : $1,200 Annual heating and electricity costs: $2,400 Monthly car loan payments: $400 Credit card - Limit $5,000, Balance So (3% minimum) Nominal interest rate and amortization period: 3% and 20 years Qualification rate and amortization period: 5.5% and 25 years Debt Amortization Coefficients: Gross debt service ratio (GDSR): 32% Total debt service ratio (TDSR): 40% For the Down payment: Purchasers have been saving $1,000 per month for the past 10 years at a rate of 5% compounded monthly. The maturity of the investment comes to term at the end of the current month and they dispose of this amount for the purchase of their new property. CMHC insurance premium: The buyers do not want to subscribe to an insured mortgage loan and have the sufficient minimum funds to obtain a conventional mortgage loan. The maximum purchase price according to their salary and down payment is: (2 points) $5467 $63, SOP 254 14 Netton

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

Personal Finance

Authors: Jeff Madura

6th Edition

0134082915, 9780134082912

More Books

Students also viewed these Finance questions

Question

Is there anything else you would like us to know about you?

Answered: 1 week ago