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A man is looking to purchase a home in the Cleveland Suburbs. He has enough for...

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Accounting

A man is looking to purchase a home in the Cleveland Suburbs. Hehas enough for a 20% down payment and an income of $70,000 peryear. His FICO Score is 660. The prime Interest Rate for 30-yearMortgages is 5%. He has a car payment of $400 per month and aStudent Loan Payment of $200 per month. The home he finds has 70Effective Property Tax Mills and Homeowner’s Insurance Costs $50per month on every $100,000 of Home Value. How much can the man payfor the home? How large of a mortgage will the bank allow him takeout?

Answer & Explanation Solved by verified expert
3.7 Ratings (671 Votes)
Solution Monthly Car Payment 400 Interest rate 5 per annum or monthly 04167 or 00042 Period 30 years or 360 months ie 12 x 30 Total payment of loan can be found by applying the    See Answer
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