2.Front/Back End Ratios

Brittany and Jacob have an adjusted gross income of $109,890. Their monthly mortgage payments is $567.23. Their semi-annual property tax is $1,840, and their annual homeowner’s premium is $1275. They have a monthly credit card bill of $980 and a monthly car loan of $410. They also have an annual college tuition bill of $1200. What is the back - end ratio? Round to the nearest percent.

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CCSS.7.RP.A.3

Brittany and Jacob have an adjusted gross income of $109,890. Their monthly mortgage payments is $567.23. Their semi-annual property tax is $1,840, and their annual homeowner’s premium is $1275. They have a monthly credit card bill of $980 and a monthly car loan of $410. They also have an annual college tuition bill of $1200. What is the front - end ratio? Round to the nearest percent.

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CCSS.6.RP.A.3B

Tom and Gwen have an adjusted gross income of $144,112. Their monthly mortgage payment for the house they want would be $1,483. Their annual property tax would be $9,330 and the homeowner’s insurance premium would cost them $1,099 per year. They have a monthly $444 car payment and their credit card monthly payment averages $4,021. What is the front - end ratio? Round to the nearest percent.

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CCSS.6.RP.A.3B

Tom and Gwen have an adjusted gross income of $144,112. Their monthly mortgage payment for the house they want would be $1,483. Their annual property tax would be $9,330 and the homeowner’s insurance premium would cost them $1,099 per year. They have a monthly $444 car payment and their credit card monthly payment averages $4,021. What is the back- end ratio? Round to the nearest percent.

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CCSS.7.RP.A.3

Ted has an adjusted gross income of $120,006. He wants a house with a monthly mortgage payment of $1,921 and annual property taxes of $7,112. His semiannual homeowner’s insurance would be $897. Ted has a credit card bill that averages $300 per month. What is the front-end ratio? Round to the nearest percent.

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CCSS.7.RP.A.3

Ted has an adjusted gross income of $120,006. He wants a house with a monthly mortgage payment of $1,921 and annual property taxes of $7,112. His semiannual homeowner’s insurance would be $897. Ted has a credit card bill that averages $300 per month. What is the back-end ratio? Round to the nearest percent.

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CCSS.7.RP.A.3

The Sinclair’s have an adjusted gross income of $117,445. They are looking at a new house that would carry a monthly mortgage payment of $1,877. Their annual property taxes would be $6,780, and their semi-annual homeowner’s insurance would be $710. Based on the front - end ratio, would the bank offer them a loan?

• Yes because the ratio is less than 28%

• Yes because the ratio is less than 36%

• No because the ratio is more than 28%

• No because the ratio is more than 36%

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CCSS.7.RP.A.3

The Sinclair’s have an adjusted gross income of $117,445. They are looking at a new house that would carry a monthly mortgage payment of $1,877. Their annual property taxes would be $6,780, and their semi-annual homeowner’s insurance would be $710.

They also have a monthly car loan of $430, and their average monthly credit card bill is $5,100. Mr. Sinclair is also paying $1,000 per month in child support from a previous marriage. Compute the back-end ratio.

• 28%

• 38%

• 53%

• 93%

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CCSS.7.RP.A.3

Banks often want the bank - end ratio to be less than what percent before they lend you money for a mortgage?

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CCSS.6.RP.A.3C

Banks often want the front- end ratio to be less than what percent before they lend you money for a mortgage?

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CCSS.7.RP.A.3