the question states current 30 year mortgage rates are 4.25% we are to not spend more than 28% of our gross income on house payments. we have 28,000 as high school graduate and i have $38,520 from my dream job we have to find out how much we should pay and compare each salary
For this problem, you can use the NPV function. The term is 30 years, the rate is 4.25%, and the gross income varies. The percentage available for rent, however, changes. Using the NPV formula with these values gives you the dollar amount that you can take out a mortgage for. Attached is the excel sheet showing the formulas as illustration.