Assume I can afford a down payment equal to 25% of my yearly income which is 73,500. What is the total purchase price I could afford for a home. How would I work this problem out.

Question

amistre64 · Answer

youd have to figure out loans will accept a 25% of your annual income as a downpayment ..

amistre64 · Answer

73500(.25) = amount you can afford for a down payment.

What does your material suggest is the required down payment value for a given total cost?

anonymous · Answer

I wrote it the way it is in the book. So I figured the down payment would be 18,375 but I cant figure out the way to find a purchase price I could afford to buy a home

amistre64 · Answer

18375 is good; but loans are not set in stone as to how much you need to have as a downpayment; you can get a house for 0% down ...  so to answer there has to be some set guide lines in your material to determine the conditions

amistre64 · Answer

Purchase Price (% down payment) = 18375

amistre64 · Answer

without knowing the % of the purchase price required for a downpayment ... there isnt much else to go on

anonymous · Answer

yeah thats whats I dont understand they dont have any interest rate so I assume its 0% but I dont know what else to do

anonymous · Answer

Im completely lost

amistre64 · Answer

do you have choices for answers?

anonymous · Answer

Ok I looked it up and finally found its a 7% interest rate for 25 years

amistre64 · Answer

7% interest rate for 7 years defines the parameters for the loan itself; not the purchase price for the home tho right?

amistre64 · Answer

7% for 25 ...

anonymous · Answer

right