Real Estate Math
A borrower's gross monthly income is $8,500. The lender requires a housing expense ratio of no more than 28%. What is the maximum allowable monthly housing payment?
A$2,380✓ Correct
B$2,125
C$2,550
D$1,700
Explanation
Maximum housing payment = Gross monthly income × Housing ratio = $8,500 × 28% = $8,500 × 0.28 = $2,380. Lenders use this front-end ratio to assess affordability.
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