You just got a promotion and you are now taking home $75,000 a year before taxes. You are thinking about upgrading your home and moving to a nicer neighborhood. You’ve been living for the past six years in a 1,300 square foot, 3 bed/2 bath home, currently valued at $137,000. Thanks to the strong capital appreciation of the past few years, you estimate that after liquidating the mortgage and covering realtor fees, you’ll be able to walk away with $40,000, which you intend to use as down payment on your new home. Your debt payments ratio is only 7% and your credit rating is 700, so qualifying for a loan won’t be a problem. The best bank rate you’ve found is 5.9% fixed for a 30 year mortgage.

Ignoring mortgage insurance premiums, homeowner’s insurance premiums, and property tax obligations, how much of a home could you afford?

Would your mortgage be considered conforming or non-conforming?

Do you think you’ll be required to obtain private mortgage insurance? Why?

please add how the annuity is found