Jake claims that he can buy a $210,000 for about the same as his rent, and...

 

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Jake claims that he can buy a $210,000 for about the same as his rent, and therefore he should definitely buy because he has heard that "renting is bad". Help him walk through this argument. a. Calculate Jake's monthly mortgage payment for a $210,000 house. b. Compare this payment to his current rent. C. Calculate the other expenses of home ownership each month, as outlined above (taxes, insurance, maintenance, and PMI). d. Discuss with Jake the total amount that he must spend each month to buy the $210,000 house. e. How does this the total monthly cost of the home compare to the rent on his current apartment? f. Is Jake's argument that he should buy because it costs the same as rent correct? 30-year Fixed-Rate FHA Mortgage 3.91% interest . . Jake expects to have to pay the following expenses in addition to his mortgage to own and maintain the house. . . 3.5% down payment Other closing costs of $5,800 at the time of purchase . PMI of 0.8% of the original loan balance each year Property taxes of 1.31% of the value of the house each year Homeowner's insurance of 1% of the value of the house each year Maintenance of 0.5% of the value of the house each year Utility expenses (gas, electricity, and water) the same as his apartment Jake claims that he can buy a $210,000 for about the same as his rent, and therefore he should definitely buy because he has heard that "renting is bad". Help him walk through this argument. a. Calculate Jake's monthly mortgage payment for a $210,000 house. b. Compare this payment to his current rent. C. Calculate the other expenses of home ownership each month, as outlined above (taxes, insurance, maintenance, and PMI). d. Discuss with Jake the total amount that he must spend each month to buy the $210,000 house. e. How does this the total monthly cost of the home compare to the rent on his current apartment? f. Is Jake's argument that he should buy because it costs the same as rent correct? 30-year Fixed-Rate FHA Mortgage 3.91% interest . . Jake expects to have to pay the following expenses in addition to his mortgage to own and maintain the house. . . 3.5% down payment Other closing costs of $5,800 at the time of purchase . PMI of 0.8% of the original loan balance each year Property taxes of 1.31% of the value of the house each year Homeowner's insurance of 1% of the value of the house each year Maintenance of 0.5% of the value of the house each year Utility expenses (gas, electricity, and water) the same as his apartment

Answer rating: 100% (QA)

a To calculate Jakes monthly mortgage payment for a 210000 house we need to consider the loan amount interest rate and loan term Loan amount 210000 original price of the house Down payment 35 210000 7... View the full answer