The Hentys are considering buying a house and are researching the potential costs. Their adjusted gross income is $130,500. The monthly mortgage payment for the house they want would be $1,400. The annual property taxes would be $10,400. The homeowner’s annual insurance premium is $975. Will the bank lend them the money to purchase the house? Use a threshold of 28% front end ratio of monthly housing expenses to monthly gross income.

Mike and Terri estimate that they want to buy a house for $186,000.00, and they need to make a down payment of 17.5% of the cost of their house. If they have 18 months to save for the down payment, how much do they need to invest into an monthly so that they can reach their goal? account earning 4.518% compounded

George and Barbara want to buy a house, they have combined incomes of $150,000 annually.  Property taxes on their new home will be about $3,600 annually and homeowner’s insurance will be about $1,800.  What is the maximum mortgage payment they can afford if their lender requires a front-end ratio of 28%?

The Jacksons are considering selling their current residence, buying a small home near Avery’s parents for $220,000 with a $100,000 30-year mortgage at 3.5%, and investing the net proceeds in their retirement accounts and education accounts. They assume they will incur 2% in transaction costs for the purchase and 6% for the sale. They have asked you the following: What will be their payment (principal and interest only) on their new home? How much will they be able to invest in their retirement accounts and education accounts after selling the old house and buying the new house? If the Jacksons purchase the new house one year from today, what will be the balance on their mortgage when they retire? What is the income tax consequence of their sale and purchase strategy?