54 Buyer Qualification
You are helping a couple find a home. They have a com-
bined monthly income of $6,500, with one car payment of
$320 and other monthly debts of $175. Assuming an 80%
loan at 8% annual interest for 30 years, a tax rate of 1.5%,
an insurance rate of .5%, and using 28/36 qualifying ratios,
estimate the maximum loan amount and sales price this
couple should consider.
Steps
Keystrokes
Display
Clear TVM values.
#
-
0.00
Enter income percent.
28
#
m
IN% =
28.00
Enter debt percent.
36
#
d
DB%=
36.00
Enter tax percent.
1.5
#
Z
TX%=
1.50
Enter insurance
percent.
.5
#
Q
IS% =
0.50
Enter term.
30
0
TRM=
30.00
Enter interest rate.
8
1
I% =
8.00
Start qualification.
?
INC =
0.00
Enter monthly income
amount.
6500
j
INC = 6,500.00
DBT=
0.00
Enter monthly debt
amount.
320
a
175
j
DBT=
495.00
DN%=
0.00
Enter down payment
percent and compute
PITI.
20
j
DN%=
20.00
PITI=
–1,820.00
Compute loan payment.
j
PMT=
–1,417.53
Compute loan amount.
j
QLA= 193,185.87
Compute sales price.
j
QPR= 241,482.34
Compute down
payment.
j
DN$= 48,296.47
Finding the Qualifying Loan Amount
In this example, you know the tax, insurance, and down
payment percentages.
Situation
Solution
