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What is the amount of your monthly debt service

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Question 1: You are looking to purchase a new home that is listed at $305,000. You intend to make an offer to buy this house at the full listed price. You have saved enough to make a 20% down payment, so the loan amount will be 80% of the purchase price. You are talking to a lender about a 30-year, fixed rate, amortizing loan. The mortgage constant is 0.05389. What is the amount of your monthly debt service?

Question 2: Lenders look at PITI, which is Principal, Interest, Taxes, and Insurance. You calculated debt service (Principal and Interest) in the previous question. Now assume that property taxes are $2,400 per year and insurance is $60 per month. Based on these assumptions and the debt service amount you calculated in the previous question, what is your total monthly PITI?

Reference no: EM132459343

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