rick has been a bricklayer for a few years now. he earns $14.50/hr and works a 40 hour week (after all deductions). he is paid every thursday. he has been renting an apartment and wants to buy a condominium for $85 000. he has been saving for a $500 down payment . rick has been visiting some mortgage institutions and has decided to get a 5-year term rate. he will amortize his condominium over 25 years. what is his monthly net income
rick has been a bricklayer for a few years now. he earns $14.50/hr and works a 40 hour week (after all deductions). he is paid every thursday. he has been renting an apartment and wants to buy a condominium for $85 000. he has been saving for a $500 down payment . rick has been visiting some mortgage institutions and has decided to get a 5-year term rate. he will amortize his condominium over 25 years. what is his monthly net income.
Rick's pay per week is: $14.5 X 40=$580.00. Since he is paid 4 times a month, then his monthly income will be: $580 X 4=$2,320.
Cost of the condo is $85,000. But, he will put $500 down payment, so he needs to borrow $85,000 - $500=$84,500, mortgage that Rick needs to take. Since, you didn't give ANY interest rate for a 5-year mortgage, will have to assume a 3.5% compounded monthly. Based on these assumptions, Rick's monthly payment will be $423.03. Therefore, Rick's net monthly income will be:
$2,320 - $423.03=$1,896.97.
