Question: Using the maximum ratios for a conventional mortgage, how big a monthly payment could the Sanchez family afford if their gross (before-tax) monthly income amounted

Using the maximum ratios for a conventional mortgage, how big a monthly payment could the Sanchez family afford if their gross (before-tax) monthly income amounted to $5,500? (Hint: Monthly mortgage payments cannot exceed 25 to 30 percent of the borrower's monthly gross income and the borrower's total monthly installment loan payments (including the mortgage payment) cannot exceed 33 percent to 38 percent of monthly gross income.)

Would it make any difference if they were already making monthly installment loan payments totaling $850 on two car loans?

Maximum mortgage payment they could make would be

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