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Question - Mortgages Stress Test - Mortgage stress test requires applicants to be also qualified for the mortgage using the "minimum qualifying rate". The minimum qualifying rate is the higher of 5.25% or the rate offered by your lender plus 2%. As a result, both Gross Debt Service (GDS) and Total Debt Service (TDS) ratios should be met using this minimum qualifying rate.
Assume that your household income is $180,000. You decided to buy a house putting a 20% down payment and finance the rest with a mortgage amortized over 25 years. The current 5-year fixed mortgage rates are 3.6%. Your house's heating and maintenance expense is $400/month and the property tax is $600/month. You also pay $1000/month for your financed car. You don't have any other debts or house related expenses.
Required -
A) What is the maximum mortgage amount that you would be qualified for?
B) How much would it be if there was no stress test?
Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have over this longer real rate?
Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.
Accounting problems, Draw a detailed timeline incorporating the dividends, calculate the exact Payback Period b) the discounted Payback Period. the IRR, the NPV, the Profitability Index.
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Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.
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