Narrative 14-1For problems in this section, use Table 14-1 from your text to find the monthly mortgage payments, when necessary.
A mortgage applicant who has a monthly gross income of $2,780 applies for a mortgage with a monthly PITI of $689.44. The applicant's other financial obligations total $405.88 per month. If the lending ratio guidelines are as given in the table below, what type of mortgage, if any, would the applicant qualify for?
Mortgage Type
Housing Expense Ratio
Total Obligations Ratio
FHA
29%
41%
Conventional
28%
36%
A. Neither FHA nor Conventional
B. Both FHA and Conventional
C. FHA only
D. Conventional only
Answer: C
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