When calculating the maximum home price using either the front ratio or the back ratio, one result is the maximum monthly payment the household can sustain. This amount covers:_____

a. Principal, interest, and escrow for taxes and insurance
b. The annual mortgage payment
c.The before-tax cash flow
d. The break-even occupancy level
e. The debt service coverage ratio

Question

neverlit7731 neverlit7731

03-03-2020
Business

contestada

When calculating the maximum home price using either the front ratio or the back ratio, one result is the maximum monthly payment the household can sustain. This amount covers:_____

a. Principal, interest, and escrow for taxes and insurance
b. The annual mortgage payment
c.The before-tax cash flow
d. The break-even occupancy level
e. The debt service coverage ratio

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osondumartins osondumartins · Answer 1 · 2020-03-03T15:26:05+01:00

Answer:A. Principal, interest, and escrow for taxes and insurance

Explanation: Front-end ratio is a percentage of your total annual gross income which can be dedicated to the payment of your home loan monthly.

Back-end ratio is a term used to describe the total percentage of your annual gross income which you can put into the servising of your debts.

The maximum monthly payment which a household can sustain covers the PRINCIPAL, INTEREST, AND ESCROW FOR TAXES AND INSURANCE When calculating the maximum home price using either the front ratio or the back ratio.