Question: Because you're putting down less than 20%, you will have to pay Private Mortgage Insurance (PMI) each month. This will cost an additional 10% of

Because you're putting down less than 20%, you will have to pay Private Mortgage Insurance (PMI) each month.

This will cost an additional 10% of the principal-and-interest payment each month.

You will also have to pay a monthly amount to an escrow account, which will cover your home insurance and your property taxes.

Assume that the home insurance is $1,200 per year, and the property taxes are 1.78% of the value of your house per year. (Use the price of your house as its value.)

Calculate your total monthly mortgage payment, including the costs described above.

House Cost = 450,000

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