Project: the American Dream - Coursework Example

5 Principal and Interest………………………………..……………………………. 5 Additional Monthly Payment……………………………………………………. 5 i. Hazard Insurance………………………………………………….. 5 ii. Property Tax……………………………………………………….. 5 iii. PMI………………………………………………………………… 5 Fees and Closing…………………………………………………………………… 5 Part 3: The amortization schedules………………………………………………………… 6 The Schedule……………………………………………………………………….

6 Experiment – Extra Payments……………………………………………………. 6 Part 1: Finding a Job and a Home Income and Lifestyle Since my education is related to art, after graduating from the college I am planning to find a job in the area I am fond of to continue my personal and professional development. New York is the center of art, fashion and culture with the constant explosion to the latest trends, numerous exhibitions and art events. Though, it would be more logical to start from Chicago since New York is very expensive city.

Since my work experience in art field is less than one year, most obviously I would find the entry level position as an Administrator in the art museum, Assistant in the art gallery or Assistant of the professor in art at the college. Certainly, the salary for such positions will vary due to the location, employer, contacts, required experience, etc. Though, the average salary related to art is around $46,000 per year (SimplyHired.com, 2011). Let us say in my case such average salary can be at the level of $36,000, which means that my monthly salary will be $3,000.

I have a friend living in Chicago, so he offered me to stay at his place and in this case I can save the money for purchasing the house. Expenses According to IRS National Standards for Allowable Living Expenses, my total monthly expenditures on food, cloths, personal care products and other necessary items will be around $517 (Justice.gov, 2010). Monthly car payments will be $234 and credit card payments is $57.96. Home Loan Rates Since I already saved $15,000 I would like to have Bank of America loan of approximately $130,000 to purchase a home.

Graph 2 in the Appendix shows 3-month mortgage rate trends, including 30-year fixed, 15-year fixed and variable loan (5/1 ARM), which shows decline within the last several months. According to Table 1 in the Appendix the 30-year fixed rate and 15-year fixed rate at the Bank of America are 4.375% and 3.500% accordingly. In such a way, the monthly payments to the bank will be $649.07 and $929.35 accordingly. I will choose 30-year fixed rate with the down payment of 10%. Payments Type Total Owed Monthly Payment Car Payment $8,500 $234.

00 Credit Card $2,200 $57.96 Totals $291.96 In such a way, $3,000 as monthly salary minus $291.96 as obligatory monthly payments equals $2,708.04 x 0.34 = $920.73 or just $920 as the total monthly payment allowed. Finding a Home Considering the above mentioned annual income it is impossible at the moment to afford the expensive house, which I am dreaming about. That is why, the