You are looking to purchase a new car for yourself. You have shopped around and found the car of your dreams. It costs $15,000. You have $2,000 in your savings account that you are going to use for a down payment and you plan to borrow the remaining $13,000. You have some different options to choose from for financing the car - through your bank and through the car dealership. With the information below, calculate the different options and decide which is the best option for you. APR Compounded Monthly 6% Term of Loan Processing Fee Monthly Payment Total Amount Repaid Total Interest Cost Bank Dealership 5% 36 months 48 months 1% You have been shopping around for your first home. You have found your dream home and are determined to get a conventional mortgage. The purchase price of the home is $180,000 and you have $9,000 (5%) saved for a down payment. The mortgage interest rate is 4% and you plan to finance your mortgage for 25 years. Using the information below and the GDS and TDS calculations, will you be approved for this mortgage? Your gross annual income is $65.000 . Your expenses each month I $300 payment on auto loan $60 auto insurance $175 transportation (gas, oil changes etc) $325 food The expenses on the home would be Property taxes $288 Utilities (heat) $75 Home insurance $125 . . GDS Guidelines TDS Guidelines Gross monthly income Multiply by GDS or TDS % Subtract shelter costs Subtract other debts Affordable Monthly Mortgage Payment Divide by Mortgage Payment Factor (pg 234) Multiply by $1,000 Affordable Mortgage Amount Divide by the financing % Affordable Home Purchase Price You decide to take advantage of personal credit and get yourself a credit card. You have done some research and found 2 different cards that you qualify for Determine which card would be the best option for you if you a. carry a $5,000 balance on your credit card and b. don't carry a balance on your credit card. Card 1 Card 2 22% APR 3% cash back on purchases $100 annual fee 10% APR $200 annual fee