Question

Gerri Frederick is a first-time homeowner. Her monthly net pay is $3,000. She estimates the following monthly housing expenses: $950.00 for her mortgage payment, $24.35 for her insurance premium, $85.75 for real estate taxes, $64.74 for electricity, $32.90 for telephone service, and $18.10 for water. Are her monthly expenses within FHA guidelines of 35% of net pay?

Answer 1

No; 35% of net pay is $1,050 which is less than her monthly expenses of $1,175.84

950+24.35+85.75+64.74+32.90+18.10
=1,175.84

3,000×0.35
=1,050

Answer 2

Answer:

The answer is NO. Gerri's monthly expenses are not within FHA guidelines of 35% of net pay.

Step-by-step explanation:

Given net pay of Gerri = $3000

Her sub categories for monthly housing expenses are - $950.00 for her mortgage payment, $24.35 for her insurance premium, $85.75 for real estate taxes, $64.74 for electricity, $32.90 for telephone service, and $18.10 for water.

Totaling these values we get, $950+24.35+85.75+64.74+32.90+18.10$ = $1175.84

So, the answer is No, her monthly expenses are not within FHA guidelines of 35% of net pay.

35% of net pay is $0.35\times3000=1050$ and this is less than $1175.84.