Finance Project

Jay Hattemer Hr. 4 Scenario 2

Harper's annual salary is \$70,000. She has \$35,000 dollars in student loans. She also owns a car that costs \$325 per month. 30% of her salary is taken out by taxes. After taxes she has a monthly salary of \$4083.33. \$402.78 is taken out, per month, by student loans, and \$325 is taken out for her car. She also has living expenses that amount to \$1983.26. These living expenses include insurance, utilities, gas, food, savings, and recreation. The maximum amount she can end up spending is \$1,372.29 each month on her house. A good steady thirty-year interest rate determined by Capitol Federal is 4.625%. This puts the maximum value of a house she can afford at \$266,910. There just happens to be a lovely 3000 square foot house located in Olathe, Kansas listed for \$265,000. At this price she pays \$1362.47 per month, around \$10 below her maximum amount possible. If Harper increased the amount of money she was paying by fifteen percent, she would end up paying \$1566.84. She would end up paying her loans for twenty-two years and eleven months. This ends up saving her \$60,673.75.