You are planning to buy a house. Assume that you have the cash to pay 20% down payment on any home that your $1,400/month maximum payment can afford including taxes and insurance (no PMI required). A lender offers you a 30 year fixed mortgage for the remaining 80% with 5% APR with 2 points and $2,000 in fees. Property taxes are $3,600 and Casualty Insurance is $1,200 annually (Assume these amounts are not dependent on the price of the house you buy).

How expensive of a home can you purchase today?________________

What would your TOTAL amount due at closing be?________________