User Manual

54 Buyer Qualification
You are helping a couple find a home. They have a com-
bined monthly income of $6,500, with one car payment of
$320 and other monthly debts of $175. Assuming an 80%
loan at 8% annual interest for 30 years, a tax rate of 1.5%,
an insurance rate of .5%, and using 28/36 qualifying ratios,
estimate the maximum loan amount and sales price this
couple should consider.
Steps Keystrokes Display
Clear TVM values.
# - 0.00
Enter income percent.
28 # m IN% = 28.00
Enter debt percent.
36 # d DB%= 36.00
Enter tax percent.
1.5 # Z TX%= 1.50
Enter insurance
percent.
.5 # Q IS% = 0.50
Enter term.
30 0 TRM= 30.00
Enter interest rate.
8 1 I% = 8.00
Start qualification.
? INC = 0.00
Enter monthly income
amount.
6500 j INC = 6,500.00
DBT= 0.00
Enter monthly debt
amount.
320 a 175 j DBT= 495.00
DN%= 0.00
Enter down payment
percent and compute
PITI.
20 j DN%= 20.00
PITI= –1,820.00
Compute loan payment.
j PMT= –1,417.53
Compute loan amount.
j QLA= 193,185.87
Compute sales price.
j QPR= 241,482.34
Compute down
payment.
j DN$= 48,296.47
Finding the Qualifying Loan Amount
In this example, you know the tax, insurance, and down
payment percentages.
Situation
Solution