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You are in the 25 %tax bracket. The apartment rents for $ 1600 per month. Your...

You are in the 25 %tax bracket. The apartment rents for $ 1600 per month. Your monthly mortgage payments would be ​$1900​, of which an average of ​$1600 per month goes toward interest during the first year. Determine whether renting or buying is cheaper in terms of monthly payments during the first year. Assume you are itemizing deductions. Is it cheaper to own or to​ rent?

math   Statistics-And-Probability   
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Answer #1

Mortgage deduction
= 25% * 1600 (amount that goes toward interest)
= 0.25 * 1600= $400

True monthly cost
= 1900 – 400
= $1500

Cost to rent: $1,600
Cost to own: $1,500


It is cheaper to own

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