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April 26th, 2019, 05:03 PM   #1
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From: tornto

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mortgage payment

You and your partner have combined gross annual income of \$105000 your mortgage payment is \$875/month. Heating oil average \$165/month and property tax are \$2700 annually; other monthly expenses total approximately \$1150.


a) Calculate the GDS ratio and TDS ratio.


b) You are considering moving to a larger home and taking on a bigger mortgage. Are you in a good financial position to do this? Explain.


PLEASE HELP


THANKS

Last edited by skipjack; April 26th, 2019 at 11:36 PM.
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April 27th, 2019, 12:22 AM   #2
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(a) GDS = (12(875 + 165) + 2700)/105000 * 100% = 14.46%
Most lenders would consider that indicates you are in a very good financial position to move to a larger home and take on a bigger mortgage if you want to.

For the TDS, include the other monthly expenses in the calculation.
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May 4th, 2019, 04:52 PM   #3
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A)

GDS = (12(875 + 165) + 2700)/105000 * 100% = 14.46%
TDS= (12(875+165)+2700+1150) )/105000 *100%*100=15.55%

B)
I think my expenses is more than my income... so living within your means is safer.

Please check my answers.

Last edited by skipjack; May 4th, 2019 at 11:41 PM.
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May 4th, 2019, 11:46 PM   #4
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What expenses? The mortgage payment is only 10% of gross income and considerably less than "other expenses".
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