Question: 1. Let's assume the Lawrences will qualify for a 6%, 30-year loan and will make a down payment of 10%. They are currently paying $300

1. Let's assume the Lawrences will qualify for a 6%, 30-year loan and will make a down payment of 10%. They are currently paying $300 on a used car auto loan for Shelby and will pay $220 per month for property taxes and homeowners insurance. Using the "Housing affordability and mortgage qualification amounts" exhibit within the chapter, calculate the following:

a. The amount of their affordable monthly mortgage payment

b. The amount of their affordable mortgage loan amount

c. The amount they can afford to pay for a home.

2. What are the tax advantages for the Lawrences of owning a home rather than renting?

3. Explain how Shelby and Cameron might use the following Personal Financial Planner sheets when deciding to purchase a home.

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