Question

For questions 3–4, you will be answering by filling in the blanks.(1 point)
Round to the nearest penny.

If you want to include closing costs of 5% with your down payment, how much additional money must you save per month?

$ /month

Answer 1

To determine how much additional money you must save per month to cover the closing costs of 5% along with your down payment, you need to know the total price of the home and the percentage that represents closing costs.

Let's say the home price is \( P \).

1. **Calculate the down payment:** If your down payment is \( D\% \) of the home price, then:
\[
\text{Down Payment} = D \times P
\]

2. **Calculate closing costs:** If the closing costs are 5% of the home price, then:
\[
\text{Closing Costs} = 0.05 \times P
\]

3. **Total upfront cost:** The total upfront cost, which includes the down payment and closing costs, is:
\[
\text{Total Upfront Cost} = \text{Down Payment} + \text{Closing Costs} = D \times P + 0.05 \times P = (D + 0.05) \times P
\]

4. **Determine the amount to be saved each month:** If you're planning to save an amount \( S \) per month, you would need to know how many months \( N \) you plan to save:
\[
S \times N = (D + 0.05) \times P
\]

From this equation, you can solve for the monthly savings required:
\[
S = \frac{(D + 0.05) \times P}{N}
\]

To give a specific answer in the form \( \$ \text{amount}/month \), you need specific values for \( P \), \( D \), and \( N \).

Without these specifics, I can't provide a numerical answer. However, you would simply substitute the values into the above formula to find your answer. If you provide those values, I can help you calculate the exact amount you need to save per month.