Question

Using the standard 28/36 guidelines, if the maximum monthly mortgage payment allowed for someone applying for a home loan is $1,085, what is their annual income? a. $36,167 b. $46,500 c. $65,100 d. $162,750

Answer 1

As 28/36 guidelines states that 28% of your gross monthly income should be spent on housing finances and 36% of your total monthly income can be considered as an income allowable for Debt.

Let Total gross monthly income = $ x

Amount given as Debt = $ 1085

So, 36 % of x = $ 1085

`(36x)/(100)=1085\\\\x=(1085 *100)/(36)=3013.88`

Annual income=12 × 3013.88=36166.666=$36,167(approx)→Option (A)

Answer 2

The correct answer is B) $46,500.

I just did the topic test on Edge and got it right :)