Final answer:
The client's maximum housing payment for an FHA EEM loan is $1,292, calculated using the standard FHA guideline housing expense ratio of 31% of gross monthly income, and ensuring that the including debts do not exceed the total obligations ratio of 43% of gross income.
Step-by-step explanation:
To calculate the maximum housing payment for which the client can qualify with an FHA Energy Efficient Mortgage (EEM), it is necessary to consider the client's income and current debts. The standard practice for these calculations typically follows the housing expense ratio and total obligations ratio guidelines, which for FHA loans are usually around 31% and 43% respectively. To find the maximum housing payment, the borrower's gross monthly income is multiplied by the housing expense ratio. In the absence of specific FHA EEM ratios, if we use the typical FHA housing expense ratio of 31%, the calculation would be as follows:
Gross Monthly Income x Housing Expense Ratio = Maximum Housing Payment
$4167 x 0.31 = $1291.77
Rounded to the nearest dollar, the maximum housing payment is $1,292. However, the total obligations ratio including the monthly debts cannot exceed 43% of the gross monthly income. This means:
Gross Monthly Income x Total Obligations Ratio - Monthly Debts = Maximum Allowed Total Payment
$4167 x 0.43 - $435 = $1441.81
Considering both calculations, the lower of the two figures would be the maximum the client could allocate to housing payment. Therefore, the client's maximum housing payment is $1,292 since we choose the lower of $1,292 or $1,441.81 to ensure the total monthly payments including other debts do not exceed the total obligations limit.