A client works 40 hours a week making $15 an hour. What is the highest monthly mortgage they can afford based on their income?

To determine the highest monthly mortgage a client can afford based on their income, we first need to calculate their gross monthly income.

Working 40 hours a week at a rate of $15 per hour gives a weekly income of $600 (40 hours x $15). Since there are approximately 4.33 weeks in a month, the gross monthly income is about $2,598 (weekly income of $600 multiplied by 4.33).

A common guideline in mortgage lending states that a borrower should aim to spend no more than 28% to 31% of their gross monthly income on housing costs, including mortgage payments, property taxes, and insurance. Using the more conservative estimate of 28%, we find that the maximum amount the client should spend on housing would be around $727.44 (28% of $2,598). This value can be rounded to about $728.

This calculated figure supports the conclusion that $728 is indeed the maximum monthly mortgage payment the client can afford based on their income. This answer aligns well with standard budgeting practices for housing expenditures.