Barb and Bob Want to Purchase a New Home but Don't

question 72

Multiple Choice

Barb and Bob want to purchase a new home but don't know how much mortgage they can qualify for.The lender requires that the total installment of loan payments do not exceed 35 percent of the monthly income.Based on Barb and Bob's financial data given below,what is the maximum monthly mortgage payment for which they can qualify? $$\begin{array} { | l | l | } \hline \text { Monthly Gross Income } & \$ 4,000 \\\hline \text { Car payment } & \$ 350 \\\hline \text { Student loan payment } & \$ 200 \\\hline\end{array}$$

• A)$1,400
• B)$1,208
• C)$1,502
• D)$850
• E)$500

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