Present Value of an Annuity Carrie and Miranda Earn the Same

question 83

Essay

Present Value of an Annuity Carrie and Miranda earn the same salary. However, Miranda has been far more financially responsible. She pays her bills on time and pays off her credit card debt quickly. Carrie had been less financially responsible. She often buys too many shoes and has allowed her credit card balance to balloon. If she is short on cash for a month, she simply decides to not even pay the minimum balance due on her credit card. Now they both are looking to buy apartments. Miranda decides she can afford to make $2,500 payments, but Carrie can only make $2,000 payments and pay off her credit card debt, too. Miranda qualifies for a 6.5%, 30-year mortgage, but because of her bad credit rating Carrie will be charged 8% on a 30-year mortgage. Both will put 20% down. How is Carrie's bad credit going to impact her apartment search?

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Definitions:

Recurring Crisis

Situations of instability or danger that happen repeatedly over a period of time, often requiring urgent attention and intervention.

Self-Concept

An individual's perception and understanding of themselves, including their attributes and who and what they are.

Skilled Care Facility

A healthcare setting providing specialized nursing care and rehabilitation services to patients with varying levels of medical needs.

Situational Supports

Resources and assistance provided to individuals based on specific needs arising from their current circumstances.