19. Disclaimer: Any connections to real people are purely Imaginary. Tom Cat and Jerry Mouse are considering buying a house Their adjusted gross income is 166,988 Their monthly mortgage payment for the house they want would be 1,544 Their annual property taxes would be 9,888 and the homeowner's insurance premium would cost them 1,007 per year. They have a 510 per month car loan, and their average monthly credit card bill Is 5,100 Would the bank lend them 210,000 to purchase their home? A. Yes, their back end ratlo Is less than 59% B. No, their back -end ratlo is greater than 28% C. Yes, their back-end ratio is less than 36% D. No, their back-end ratio is greater than 36% A B C D

To determine whether the bank would lend Tom Cat and Jerry Mouse $\$210,000$ to purchase their home, we need to calculate their back-end ratio. The back-end ratio is the percentage of a borrower's monthly gross income that goes towards all monthly debt payments, including the mortgage payment, property taxes, insurance, car loan, and credit card bill.<br /><br />First, let's calculate their monthly gross income:<br />\[ \text{Monthly Gross Income} = \frac{\text{Annual Income}}{12} = \frac{166,988}{12} = 13,915.33 \]<br /><br />Next, we need to calculate their total monthly debt payments:<br />- Monthly mortgage payment: $\$1,544$<br />- Annual property taxes: $\$9,888$, which is $\frac{9,888}{12} = 826.00$ per month<br />- Homeowner's insurance premium: $\$1,007$ per year, which is $\frac{1,007}{12} = 84.17$ per month<br />- Car loan: $\$510$ per month<br />- Average monthly credit card bill: $\$5,100$<br /><br />Now, sum these monthly payments:<br />\[ \text{Total Monthly Debt Payments} = 1,544 + 826 + 84.17 + 510 + 5,100 = 8,064.17 \]<br /><br />Next, we calculate the back-end ratio:<br />\[ \text{Back-End Ratio} = \frac{\text{Total Monthly Debt Payments}}{\text{Monthly Gross Income}} = \frac{8,064.17}{13,915.33} \approx 0.578 \text{ or } 57.8\% \]<br /><br />Since the back-end ratio is 57.8%, which is greater than 36%, the bank would not lend them the money.<br /><br />Therefore, the correct answer is:<br />D. No, their back-end ratio is greater than $36\%$.