PreCalc Project Scenario #1
Brent is a construction foreman who did not attend college. He is 24 years old, and earns an annual salary of $50,000. He just purchased a $23,000 car with a 6.50% 5 year car loan. He wants to buy his first home in the next few months.
Gas and Car insurance
An average full coverage car insurance for a 24 year old driver is $325.67
Total monthly budget
Phone bill: $65
Car payment: $450.02
Total monthly expenses: $1,452.98
Budget for house
$3,125 - $1,452.98 = $1672.02
Actual monthly payment
It is located in Westbrooke Dr, Overland Park, and has four bedrooms.
The house is 2,022 square feet, but Brent earns enough and always wanted to live in a big house.
I used the present value formula again to find the monthly mortgage payment which will be $952.88
Total house payment
Interest: 343,036.8 - 205,000 = $138,036