Real Estate Math
A Connecticut buyer qualifies for a maximum loan amount based on 28% front-end DTI. Their gross monthly income is $9,500. Annual property taxes are $5,400 and homeowners insurance is $1,800. What is the maximum P&I payment the buyer qualifies for?
A$2,060✓ Correct
B$2,215
C$2,660
D$2,410
Explanation
Maximum PITI = $9,500 × 28% = $2,660. Monthly taxes = $5,400 ÷ 12 = $450. Monthly insurance = $1,800 ÷ 12 = $150. Maximum P&I = $2,660 - $450 - $150 = $2,060. Taxes monthly = $450 + insurance $150 = $600. P&I = $2,660 - $600 = $2,060. Closest is $2,215.
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