Marcy has just gotten a promotion at work and she wants to buy a house. She currently pays $350 a
month for a car payment and $200 a month on her credit cards. She has a gross monthly income of
$4,000. Using the Debt Ratio Formula, calculate her potential maximum monthly house payment.

As per the 28/36 rule, Marcy can have debts not exceeding 36% of her gross income. If her gross income is $4000, her maximum debts should be 36% of $4000

=36/100 x $4000

=0.36 x $4000

=$1,440

Marcy has a $350 car payment and 200 credit payments every month.

current monthly payments

= $350 + $200

=$550

Marcy's loan limit is at $1440; current repayments total $550.

The maximum amount that can go to a housing loan is

=$1440 - $550

=$890

Marcy has just gotten a promotion at work and she wants to buy a house. She currently pays $350 a month for a car payment and $200 a month on her credit cards. She has a gross monthly income of $4,000. Using the Debt Ratio Formula, calculate her potential maximum monthly house payment.

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Marcy has just gotten a promotion at work and she wants to buy a house. She currently pays $350 a
month for a car payment and $200 a month on her credit cards. She has a gross monthly income of
$4,000. Using the Debt Ratio Formula, calculate her potential maximum monthly house payment.