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What is the maximum monthly mortgage payment

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The Elliots want to buy a condo in Richmond. Banks use the affordability rule: no more than 32% of gross monthly household income can go towards paying the mortgage, property taxes, heating costs and 50% of the strata fees. Their gross income is $10,000 per month, property taxes are $2,400/year, heating costs average $50/month and strata fees $400/month.

(a) What is the maximum monthly mortgage payment they could afford?

Using mortgage qualiying rate of j2 = 5.25%, how large of a mortgage would they qualify for if it is amortized over 25 years and monthly payments? Express your answer in whole number and do not enter "tiny_mce_markerquot; sign.

Reference no: EM133004752

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