# Modern Townhouse in Lenexa

## Total Funds Available After Car Payments, Student Loans and Taxes

\$70,000 x .3 = \$21,000

\$70,000-\$21,000 = \$49,000

\$49,000/12 = \$4083.33 per month

\$4083.33 - \$325 -\$473.7 = \$3284.63-net monthly income

An interest rate for a 30 year fixed loan would be 4.875% each month according to Bank of America, taking into account a 20% down payment of the \$85,000 cost of the home, which is \$17,000

## Cost Rational

For this house including all major expenses the amount that Harper can afford is about \$350- 400 per month. This is because once homeowners insurance is paid (\$101), home warranty is paid (\$74.92), home security is paid (\$37) and Homeowners Associations dues are paid (\$131) Harper will still have \$2940.71 to spend on house payments per month and other expenses. Also, Harper will have her student loans paid off in 8 years so she will not have to worry about that in 8 years giving her \$473.70 more to spend a month. Her monthly cost for this home would be \$359.86, with a 30 years fixed loan with an interest rate of 4.785%. It would make sense for her to have this much because of her income without living in a house.

## Borrowing Rational

If Harper borrowed \$68,000 from the bank she would be able to pay it off after 30 years with a \$359.86 monthly cost. Though she is borrowing close to what she makes in a year without taxes, the amount of money left over, \$2580.85 per month, she can pay for other expenses and put away a steady amount of money to cover her house payments if she has a financial problem in the future. She will also have to pay monthly taxes of \$130.42 for her house, which will still leave her a large amount of money to save, invest and spend-\$2450.43

## Payment Increase by 15% Effects

\$359.86 x .15 = \$53.98

\$53.98 + \$359.86 = \$413.84 monthly payments

\$413.84 x 22.66 x 12 = \$112,419.64 (22.66 is equal to 22 years and 8 months)

\$359.86 x 360 = \$129,549.60

\$129549.60-\$112419.64 = \$17,129.96

So Harper will save \$17,129.96 if she increased her monthly payments by 15%

She would also pay off her home around 8 years earlier than she would have in a 30 years fixed loan.

## A Look At The Town House

The townhouse has two bedrooms, and 1 full bath and two half baths. Two bedrooms are smart to have even though Harper is living by herself because she might have out-of-state relatives who might visit and need a place to stay. Through buying this house Harper has access to tennis courts and a swimming pool.