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Juan and Rita Hernandez have been married six (6) years. They have two (2) children and do not plan to have any more. Juan and Rita own two (2) Duds and Suds Laundromats. Their business is doing very well. They purchased their business shortly after they were married and at that time, they were determined to make sure the business was successful before starting a family. After three (3) years in business, their cash flow was established and they both felt comfortable with having a family.
From the beginning of their marriage, they learned to negotiate and compromise for what they wanted. They lived with Juan’s parents from the start of their marriage. This arrangement allowed them to put all of their financial resources into the business. They were both working much of the time and the living arrangement worked very well for them. After having their two children, however, the home of Juan’s parents was feeling cramped and too small. Juan’s father died shortly after their last child was born. Juan is an only child, and is mother is older and not in good health, so he feels very responsible for her care. Rita and Juan decided it may be time for them to purchase a home of their own. They discussed the move with Juan’s mother. Because of her health problem, Juan believes it would be best for them to purchase a home large enough for their family of four (4) with additional space for his mother to live with them. To purchase a home large enough for all of them, the cost of housing will increase. Juan’s parents had their home paid for, so to purchase a new home will have a major impact on the family’s housing costs. Juan’s mother makes it perfectly clear that they should sell her house and use the money from the sale to apply to the purchase of their new home. With that offer, Juan, Rita, and Mom sit down to discuss their family finances to determine how much they could allow in their budget for the increased housing expense.
Juan and Rita pay themselves a monthly salary from their business. Their net income is $42,000 per year. Juan’s mother is retired and has a retirement income of $15,000 per year. Mom Hernandez has offered to contribute her retirement income to the household budget.
Juan & Rita’s Net Monthly Income: $3,500.00
Mom Hernandez’s Net Monthly Income: 1,250.00
Total Net Monthly Income: $4,750.00
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Table of Contents | Homebuyer Course Start Page | Find A Realtor | Budgeting To Buy a Home | Neighborhoods | Find Your First House | Inspect Before You Buy | Shop For a Mortgage Loan | Mortgage Home Loan Process | Credit Score and Credit Report | Home Mortgage Loan Closing | Being a Home Owner
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