Wednesday, April 2, 2014

Chapter 8 Comparing Mortgages and Affordability Ratios

Remember that we spent a considerable time in chapter 4 studying loans.

These are the main points from this chapter:
1.  Small differences in mortgages can cost thousands over time.
2.  There are other expenses to consider when comparing renting to owning.
3.  Know what you can afford before making a decision, according to the book 28% is acceptable front end ratio, 36% back end ratio.  The book also said that 28% of gross income is acceptable rent.
4.  To find the total interest paid on a mortgage, you sum all the payments and subtract the amount borrowed.  For further study, see the textbook (avail at the bookstore) and chapter 4's notes (posted).

8.1 8.3

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