Tax Savings. Matt paid mortgage interest of $4,330 during his first year in the condo. His property taxes were $600, and his homeowner's insurance was $460. If Matt is in a 25% marginal tax rate bracket, what were his tax savings for his first year?
Problem:-
Cost of Condo. Matt has found a condominium in an area where he would enjoy living. He would need a $5,000 down payment from his savings and would have to pay closing costs of $2,500 to purchase the condo. His monthly mortgage payments would be $520 including property taxes and insurance. The condominium's homeowner's association charges maintenance fees of $400 per year.
Calculate the cost of Matt's condo during the first year if he currently has the $5,000 down payment invested in an account earning 5% interest.