Real Estate Math
A Michigan buyer's annual income is $72,000. Using the traditional 28% front-end ratio, what is the maximum monthly PITI payment?
A$1,680✓ Correct
B$2,016
C$1,800
D$2,100
Explanation
Monthly gross income = $72,000 / 12 = $6,000. Maximum PITI = $6,000 x 0.28 = $1,680. To solve this, multiply the relevant values: $72,000 at 28%.. The correct answer is $1,680.. This is a common calculation on the Michigan real estate exam.
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