Your sister is considering the purchase of a home rather than renewing the lease on her
two-bedroom apartment. She is currently paying $850 per month for rent. She has asked
you to help her decide what sort of home she might be able to afford if she wants to keep her
living expenses the same. Her bank offers first-time home buyers (with good credit) a 30-year
mortgage at a fixed rate of 5.49%. The cost of insurance and property taxes is about $175 per
month in the neighborhood where she'd like to live.
