Pre-Calc Finance Project

Harper earns \$4,083.33 a month

Harper earns 70,000 dollars a year, and after the 30% tax cut she is left with \$49,000 for her total annual salary.

Harper's Student Loan Payment is \$402.78 Monthly

Because Harper went to college, she has a student loan of \$35,000. The loan must be paid within 10 years, requiring 120 payments from her. So, if the interest rate is 6.8%, her payment would be \$402.78 per month.

Car Payment

Harper also has a payment to make towards her Car for \$325 a month.

Costs of Living

Harper also has money that needs to go towards food and other necessities. If she spends around \$400 a month on food and \$200 dollars a month on other groceries, her cost of living would come to about \$600 a month.

Material Wealth

Obviously Harper will want to spend her money on home improvements and furniture, so she will spend an average of about \$1000 dollars a month in this category.

Totaling up the Digits

\$4,083.33

-\$402.78

-\$325

-\$600

-\$1,000 = up to \$1,755.55 a month to spend on a house.

Bank of America requires at least a 4.732% interest rate on a 30 year loan. So, Harper would be capable of buying a house at \$337,240.69 or less.

An Affordable House for Harper

The house picture here is priced right around \$300,000, this is within the price range Harper would be looking for.

Housing Cost (Current)

PV= 300,000

I%= 4.372

N= 360

PMT= 1,497.32

\$1,497.32 x 360pmts = \$539,035 spent

Housing Cost (Monthly PMT Increases 15%)

PV= 300,000

I%=4.372

PMT= \$1,721.92

N= 273.15

\$1,721.92 x 273.15 = \$470,341 spent

*10.24 years and \$68,694 saved