A borrower earns $8,000/month and makes credit card and car note payments of $900. A conventional lender requires a 30% income r

Question

3 years ago

12

A borrower earns $8,000/month and makes credit card and car note payments of $900. A conventional lender requires a 30% income r

atio. What monthly amount for housing expenses (principal, interest, taxes, insurance) will the lender allow this person to have in order to qualify for a conventional mortgage loan?

Mathematics

1 answer:

Pavlova-9 [17] · Answer 1 · 2021-12-30T13:58:09+03:00

Pavlova-9 [17]3 years ago

5 0

Answer: The lendor will allow for $1500 for the housing expenses.

This lendor is allowing 30% for the debt. So, we start by multiplying 8000 times 0.3 which equals 2400.

However, we have to subtract the current debts of 900.
2400 - 900 = 1500