home buyer makes $250,000 per year. It has $300,000 save for the downpayment plus enough to cover closing costs and any bank required savings. The bank uses one back ratio for approval of 48% on 80% LTV loans, which is what the borrower expects to put down. Taxes and insurance generally are $3,000 per month. The rate on a 30 year amortization loan would be 3%. The purchaser has a car loan of $500 per mont, student loans of $1,000 per month, credit cards of $300 per month. Given the down payment, ltv, and back ratio, how much can the purchaser spend on a house
home buyer makes $250,000 per year. It has $300,000 save for the downpayment plus enough to cover closing costs and any bank required savings. The bank uses one back ratio for approval of 48% on 80% LTV loans, which is what the borrower expects to put down. Taxes and insurance generally are $3,000 per month. The rate on a 30 year amortization loan would be 3%. The purchaser has a car loan of $500 per mont, student loans of $1,000 per month, credit cards of $300 per month. Given the down payment, ltv, and back ratio, how much can the purchaser spend on a house
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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A home buyer makes $250,000 per year. It has $300,000 save for the downpayment plus enough to cover closing costs and any bank required savings. The bank uses one back ratio for approval of 48% on 80% LTV loans, which is what the borrower expects to put down. Taxes and insurance generally are $3,000 per month. The rate on a 30 year amortization loan would be 3%. The purchaser has a car loan of $500 per mont, student loans of $1,000 per month, credit cards of $300 per month. Given the down payment, ltv, and back ratio, how much can the purchaser spend on a house
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