First Home Excitement

Hr. 7 Colwell

Jenny the Bank Teller

Salary is $40,000, has $20,000 in student loans after dropping out, and has to pay $230 a month for car payments. Her net annual income is $28,000, so she can afford about 25% of her net income which is $700. Jenny's net monthly income is $2,333.33.

As for paying off her student loans, she must do so in a 10 year span with the current interest rate of 6.8%.

After doing so using the present value formula the resulting monthly payment would be $230.16.

By subtracting the monthly costs of the student loans, car payments, and about $100 for other living costs will be what Jenny has left for the home.

Nice Cozy Home - For Sale: $125,000

421 N Mahaffie St. Olathe, KS 66061

3 beds, 2 baths, 1,014 sqft

To find out the exact monthly payment of this lovely home use the formula below.

Monthly payment - $642.67

Monthly payment increased by 15% -

$642.67 + $96.40 = $739.07

One could also make use of the finance app on their graphing calculator to find out how much money and time Jenny would save if she increases the monthly payment by 15%.

274.296 divided by 12 is approximately 22.858, so Jenny would make the payment about 7 or 8 years quicker. She would also save about $28,637.25.