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eBook Do the Math 9-2 Mortgage Affordability Seth and Alexandra Moore of Elk Grove Village, Illinois have an annual income of $110,000 and want to buy a home. Currently, mortgage rates are 4.5 percent. The Moores want to take out a mortgage for 30 years. Real estate taxes are estimated to be $5,280 per year for homes similar to what they would like to buy, and homeowner's insurance would be about $1,260 per year. a. Using a 28 percent front-end ratio, what are the total annual and monthly expenditures for which they would qualify? Round your answers to the nearest dollar Total annual expenditures Monthly expenditures b. Using a 36 percent back-end ratio, what monthly mortgage payment (including taxes and insurance) could they afford given that they have an automobile loan payment of $470, a student loan payment of $360, and credit card payments of $2607 (Hint: Subtract these amounts from the total monthly affordable payments for their income to determine the amount left over to spend on a mortgage) Round your answer to the nearest dollar c. Using a 36 percent back-end ratio, if the Moores had zero debt what monthly mortgage payment (including taxes and insurance) could they afford? Round your answer to the nearest dollar

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