Person A has a take home pay of 3980 and wishes to spend only 1/4 of this pay on a monthly house payment. They have 18000 saved for down pmt and can get an APR of 5.35% from the bank, compounded monthly. Whats the total cost of a house Person A can afford w/a 15-yr mortgage? Round to nearest cent

Person A has a take home pay of 3980 and wishes to spend only 1/4 of this pay on a monthly house payment. They have 18000 saved for down pmt and can get an APR of 5.35% from the bank, compounded monthly. Whats the total cost of a house Person A can afford w/a 15-yr mortgage? Round to nearest cent

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter5: Making Automobile And Housing Decisions

Section: Chapter Questions

Problem 8FPE

See similar textbooks

Related questions

Q: A couple requires a mortgage loan of $182,000. They figure they can afford $1400 a month. If they…

A: A mortgage refers to a covered loan that is taken out for the purchase of a property which itself…

Q: Jason is buying a home with a $150,000 mortgage using a 6 percent, 15-year loan. How much of the…

A: Loan amortization schedule represents the amount of periodic payments composed of the interest…

Q: Let’s assume that you plan to purchase a house which is selling for $350,000 today. You will make a…

A: Formulas that are used:-

Q: Todd Foley is applying for a $290,000 mortgage. He can get a $2,030 monthly payment for principal…

A: Calculation of number of months:Excel spreadsheet for calculation of number of months

Q: Ann Is buying a new home for $365,000. She is choosing between 2 loan options. Loan A is a 15-year…

A: Data given Particulars Loan amount ($) Monthly rate N (years) Period Monthly payment ($) Loan A…

Q: The Garcia family has decided to pay the price of $375,000 for a new home. Their bank offers a 5.4%…

A: a) Down Payment = cost of house * 15%

Q: can be replaced by a loan at an interest rate of 6% at a cost of 8% of the outstanding loan amount…

A: Loan payments: These represent payments made by the borrower to the lender for amortizing the loan…

Q: After making payments of $901.10 for 8 years on your 30 year loan at 8.3%, you decide to sell your…

A: The person has made a payment (PMT) of $901.10 for 96 months ( 8*12). Number of months (U) remaining…

Concept explainers

Loans

A loan is a term that we are all familiar with. The processing of loans is one of the most important functions of a bank. It keeps our economy stable and facilitates the implementation of monetary policies. Let's take a look at the different forms of loans and get some answers to some common questions.

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Help m sirr
You'd like to purchase a house. You're monthly take home pay is $4560. You'd like to use one fourth of your take home pay for a house payment. You have $18500 for a down payment. You can get an APR of 4.35% compounded monthly. What is the total cost of a house you can afford with a 15 year mortgage?
Bha
Find the monthly house payment necessary to amortize the following loan. 9) In order to purchase a home, a family borrows $121,000 at 3.0% for 30 yr. What is their monthly payment? Round the answer to the nearest cent.
Please correct answer and don't use hand raiting
Hw.81.
Suppose your gross monthly income is $5,200 and your current monthly payments are $425. If the bank will allow you to pay up to 36% of gross monthly income (less current monthly payments) for a monthly house payment, what is the maximum loan you can obtain if the rate for a 30-year mortgage is 4.65%? (Round your answer to the nearest cent.) Need Help? Read It Submit Answer
using the maximum ratios for a conventional mortgage, how big a monthly payment could one afford if theor gross income is $4,000? Would it make a difference if he already had a car payment of $750?
You wish to buy a house for $170,000. You want to put down a down payment first, then mortgage the rest. How much would the down payment be and how much would the mortgage be for the following percentages? Answer to nearest whole dollar. a) 15% down payment b) mortgage loan amount after 15% down рayment c) 20% down payment d) mortgage loan amount after 20% down рayment
The Allen's want to purchase a house. They can afford $1,025 a month for 20 years and a $23,000 down payment. They finance the loan with an APR of 5.23% mortgage rate for 20 years. Determine the amount of the Allen's loan using TVM Solver on calculator. N= I%= PV= PMT= FV= P/Y= C/Y=
You can afford monthly payments of $800. If current mortgage rates are 3.06% for a 15-year fixed rate loan, how much can you afford to borrow? If you are required to make a 20% down payment and you have the cash on hand to do it, how expensive a home can you afford? (Hint: You will need to solve the loan payment formula for P.)
PA Use PMT= to determine the regular payment amount, rounded to the nearest dollar. The price of a home is $217,000. The bank requires a 20% down payment and three points at the time of closing. The cost of the home is financed with a 30-year fixed-rate mortgage at 7%. Complete parts (a) through (e) below. a. Find the required down payment. $ b. Find the amount of the mortgage. c. How much must be paid for the three points at closing? S (Round to the nearest dollar as needed.) d. Find the monthly payment (excluding escrowed taxes and insurance). S (Round to the nearest dollar as needed.) e. Find the total cost of interest over 30 years. (Round to the nearest dollar as needed.)