Question

Suppose that in order to qualify for the loan, the total monthly amount paid cannot exceed 30 percent of monthly income. What is the minimum monthly income needed to qualify for the loan? What is the minimum annual income needed? (Note: This is a simplified minimum income requirement calculation, for the purposes of this project, as it does not take into account other costs such as insurance or other loans or assets currently held.)

The total monthly amount paid is 632.72

Answer 1

Total Monthly Amount Paid = K = $ 632.72 and Loan Eligibility: Total Monthly Amount Paid < = 30 % of Monthly Income

Therefore, Minimum Monthly Income Required = 632.72 / 0.3 = $ 2109.067

Minimum Annual Income Required = 2109.067 x 12 = $ 25308.8