Home affordability analysis. Use Worksheet 5.3. Selma and Rodney Jackson need to calculate the amount that they can afford to spend on their first home.They have a combined annual income of 47,500 and...

Home affordability analysis. Use Worksheet 5.3. Selma and Rodney Jackson need to calculate the amount that they can afford to spend on their first home.They have a combined annual income of
47,500 and have
27,000 available for a down payment and closing costs. The Jacksons estimate that homeowner’s insurance and property taxes will be
250 per month. They expect the mortgage lender to use a 30 percent (of monthly gross income) mortgage payment affordability ratio, to lend at an interest rate of 6 percent on a 30-year mortgage, and to require a 15 percent down payment. Based on this information, use the home affordability analysis form in Worksheet 5.3 to determine the highest-priced home that the Jacksons can afford.