Section 5: Buy a House (Lesson 5.6) Name ______________________
Look in your Long Term Budget from part 1 of the project and find how much you have reserved for your Rent/Mortgage.
Long Term Budget Mortgage Payment $ ________________________________________
Let’s say interest rates for buying a home are around 5.5% on a 30 year loan. Determine a reasonable price range for a home that you can buy on your current budget. N 12(30) I% 5.5 *PV PMT -( ) FV 0 P/Y 12 C/Y 12 PMT: END BEGIN Calculator Directions:
Apps, 1: Finance, 1: TVM Solver, Input values, Quit
Apps, 1: Finance, 4: tvm_PV
Price Range for your home:
How do interest rates affect your price range? You are going to determine a reasonable price range for your home with the same mortgage payment, but now interest rates have lowered to 4% on a 30 year loan. N 12(30) I% 4 *PV PMT -( ) FV 0 P/Y 12 C/Y 12 PMT: END BEGIN
Price Range for your lovely home:
How big of a difference does the price of a house make? Look on or another real estate website. Look for homes in both price ranges in Frisco/McKinney. What are differences you can find in homes in these two price ranges?
Price Range #1 _____________________________ Price Range #2_________________________________
Address ___________________________________ Address______________________________________
Square Footage __________________________ Square Footage ________________________________
Number of bedrooms ________________________ Number of bedrooms ___________________________
Number of bathrooms _______________________ Number of bathrooms ___________________________
Number of family rooms _______________________ Number of family rooms ________________________
Game room, family room, media room, etc… Game room, family room, media room, etc…
What else does your house have? What else does your house have?
What kind of a difference does a double income make? This means you have to get married (or at least live with someone long-term). Take your income and double it. Use this number to find a new price range for a home
Long Term Budget Mortgage Payment * 2 $ ________________________________________ N 12(30) I% 5.5 *PV PMT -( ) FV 0 P/Y 12 C/Y 12 PMT: END BEGIN N 12(30) I% 4 *PV PMT -( ) FV 0 P/Y 12 C/Y 12 PMT: END BEGIN
What are some potential problems that could occur from depending on that second income? Section 6: Buy a Car (Lesson 5.7)
What is the total amount that you can afford?
Research – What types of cars meet your needs?
Directions: Place a check mark next to features that are important to you for your car. Price Year Model Gas Mileage Fuel Type # of doors Total # of miles # seats Type of engine Transmission Body style Navigation
a. Visit the Kelley Blue Book “Show Me the Cars that Meet My Needs” website
b. Update your location
c. Answer the questions to indicate your desired features. May have to press the “+” to create more features.
d. Click “view” to learn what models have your desired features
e. Click “model details” next to the picture of each model to learn more about that model including additional features (under specs).
f. Identify two cars you are interested in further researching. Record the information below. Car 1 Car 2 Make: Make: Model: Model: Year: Year: Price: Price: Mileage: Mileage:
Answer the questions below:
1. Were there some features that one car had that another did not?
2. Which car would you select and why?
3. What trade-offs did you have to make in order to get the right car for you and your budget?
Step 2: Spending Plan Evaluation (Financing Options) Your car Choice: Car Price: $ Now use the TVM solver in your calculator to find the monthly payment for each lending source above.
Bank N 60 I% 5.9 *PV
**PMT FV 0 P/Y 12 C/Y 12 PMT: END BEGIN Dealership *N 48 *I% 3.9 *PV
**PMT FV 0 P/Y 12 C/Y 12 PMT: END BEGIN