Texas Instruments BA Real Estate - Net Cost of Housing Based on Tax and Insurance Percents

Buyer Qualification 61
Net Cost of Housing Based on
Tax and Insurance Percents
1. Clear TVM values (if not already cleared).
# -
2. Enter sales price. $105,000
@
3. Enter tax percent (if not already entered). 1.5
# Z
4. Enter insurance percent (if not already
entered).
.35
# Q
5. Enter term of loan (in years). 30
0
6. Enter interest rate. 8
1
7. Enter loan amount. $84,000
2
8. Compute payment.
$ 3
$.616.36
9. Recall loan amount.
] 2
$84,000.00
10. Multiply by annual interest rate
(as a percentage) to find
approximate annual interest.
O ] 1 A j
$6,720.00
T g
11. Add annual tax
amount.
] @ O ] # Z A j
$1,575.00
12. Calculate total tax-deductible items.
a ] g j
$8,295.00
13. Multiply by homeowner’s income-tax rate.
O
28
A
14. Calculate annual tax savings.*
j
$2,322.60
15. Divide by 12 to find monthly tax
savings, and store the result in memory.
B
12
j
$193.55
T g
16. Compute PITI.
$ &
$.778.24
17. Subtract monthly tax savings.
X ] g t
$.193.55
18. Calculate monthly net cost of housing.
j
$.584.69
* Assumes the homeowner is not using the standard deduction.