Deb and Rusty have just gotten married and wish to buy a home. They both work in Boston and have a combined income of $90,000. They found a modest starter house which they are buying for $350,000.1. They plan to use their $40,000 is savings to cover the closing costs the bank will charge them, which are 1% of the amount they borrow from the bank. The rest of the savings will be used as a down payment. For example, if they borrow $330,000 using $20,000 for a down payment, the closing costs will be $3,300, which still leaves them some savings. Determine the largest amount they can use for a down payment and still pay the closing costs.

Question

Deb and Rusty have just gotten married and wish to buy a home. They both work in Boston and have a combined income of $90,000. They found a modest starter house which they are buying for $350,000.1. They plan to use their $40,000 is savings to cover the closing costs the bank will charge them, which are 1% of the amount they borrow from the bank. The rest of the savings will be used as a down payment. For example, if they borrow $330,000 using $20,000 for a down payment, the closing costs will be $3,300, which still leaves them some savings. Determine the largest amount they can use for a down payment and still pay the closing costs.

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