Activity 2

When you are done show the teacher. This assignment is due at the end of the period.

Credit is an important part of the assignment. When you build your house you need to make sure you sell the house to somebody who can buy it. You check their credit report to see if they qualify for buying the house.

Here is a credit report for Craig & Mari Masuoka.

Copy these definitions:

Occupation = Job
Offer = What they want to pay for the house.
Down = The first payment paid to the bank.
Mortgage Payment = How much they pay the bank each month.
Assets = How much money they have.
Income = Money they get from their occupation.
Other Debt Payments = Money they pay to other banks for car loans and credit cards.

Now it is your turn. Here is Esteban and Iko Salinas credit report. You will be doing the math on their report.

Step 1:

Bidder's Assets > Down Payment
     $50,048       > $272,000 times 20%
     $50,048       > $272,000 times .20
     $50,048       > $54,400

Since $50,048 is not more than $54,400 Craig and Mari cannot buy the house.

Step 2:

28% of monthly income > Mortgage Payment
      Income times 28%       > $1597
      $5914   times .28         > $1597
       $1655.92               > $1597

Since $1655.92 is greater than $1597 Craig and Mari could buy the house.

Step 3:

36% of monthly income > mortgage + other debt
     36% times $5914          > $1597      + $237
    .36     times $5914          > 1834
           $2129.04                > 1834

Since $2129.04 is greater than $1834 Craig and Mari could buy the house.