# Select the first three letters . . .

by Aleshia
(Mount Gay , West Virginia)

Select the first three letters of your last name. Each letter has a numerical place value in the alphabet. Numerical place value of ALH
Multiply your sum by 1500. This is your yearly income for Week Four Discussion 1.
Please use the following monthly expenses: Car payment = \$283.15, Car insurance = \$72, Utilities (includes water and power) = \$242.77, Internet = \$32, and Cell Phone = \$79.95.
You also have a yearly educational bill of \$7980 which includes textbooks and classes.
What percent of your monthly income is the car payment?
Subtract the sum of your monthly expenses. Use this value to calculate what percent of your income is now available to spend for food, clothing, and your rent or mortgage.
Use the plan at the bottom of page 538, “Mathematics in Our World Revisited,” to calculate the monthly mortgage payment established by your monthly income which is 28%

Assume you can afford a down payment equal to 25% of your yearly income. What is the total purchase price can you afford for a home? Would this amount allow you to purchase a home in the area where you live?

### Comments for Select the first three letters . . .

 Jan 26, 2012 Calculate Mortgage Payment by: Staff ------------------------------------------------------- Part II Subtract the sum of your monthly expenses. \$2,625 per month, monthly income -\$283.15 per month, Car payment -\$72 per month, Car insurance -\$242.77 per month, Utilities (includes water and power) -\$32 per month, Internet -\$79.95 per month, Cell Phone -------------------------------------- \$1,915.13 per month (monthly income after monthly expenses, without educational expenses) If educational expenses are included: \$1,915.13 per month -\$665 per month, educational expenses -------------------------------------- \$1,250.13 per month (monthly income after monthly expenses, including educational expenses) --------- Calculate what percent of your income is now available to spend for food, clothing, and your rent or mortgage. [(Monthly income after payments)/(Monthly income)] * 100 = % available Without including educational expenses (\$1,915.13 /\$2,625)*100 = 72.9573% Available income is 73.0% of the monthly income. Including educational expenses (\$1,250.13 /\$2,625)*100 = 47.624% Available income is 47.6% of the monthly income. Assume you can afford a down payment equal to 25% of your yearly income. \$31,500 * .25 = \$7,875 down payment What is the total purchase price you can you afford for a home? Mathematics in Our World Revisited How Much Can You Afford to Pay for a Home? ▲ Experts suggest that a person can afford to pay 28% of his or her gross monthly income for a home mortgage. Given this assumption and using Table 9-1 on page 435, you can ﬁgure out how much you can afford to pay for a home, as shown. 28% of gross monthly income = .28*\$2,625 = \$735 You can afford a monthly mortgage payment of \$735.00. Now to see what you can afford to borrow, look up the number corresponding to 7% and 25 years in Table 9-1 on page 435. It is 7.70. Set up an equation and solve for x. 7.70x = \$735 X = \$735/7.70 = 95.4545 You can afford a mortgage of 95.4545*1000 = \$95,454.5 You can afford a mortgage of \$95,454.50 Finally, add your down payment of \$7,875 \$95,454.5 + \$7,875 = \$103,329.5 Can purchase a home costing about \$103,330 Would this amount allow you to purchase a home in the area where you live? Mount Gay , West Virginia Yes According to zillow.com, there is one home currently for sale in Logan , West Virginia (zip code 25601) at a sale price of \$75,000. http://www.zillow.com/homes/Mount-Gay-,-West-Virginia_rb/ Thanks for writing. Staff www.solving-math-problems.com

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