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Finding a HOME using SPAMS – Size (Bedrooms, Bathrooms, Square Footage – sq. ft., Amenities – pool/bbq/fitness)P – Price (Is the price comparable to other places)A – Area (Proximity to schools, markets, malls, freeways, workplace, hospitals, family)M – Maintenance (Fees associated with associations or the costs to remodel the home)***Tips and hints: Size typically refers to the number of bedrooms, bathrooms and square footage of the property. Though some properties will have approximately the same amount of sq ft, it does not mean the space is used the same. Some may have a yard, rooms may be different sizes, and the layout of home may be not to your liking. Price is the typically the simplest of the 4 categories as we can easily tell whether or not we can afford the home by understanding what our monthly payments will be a month. Some items to consider are whether the size, area, and maintenance of your home is worth that price. Be sure to calculate your monthly mortgage to see if the home fits into your budget.Area refers to where your home is located. For some, the proximity to good public schools is important. While others, who send their kids to private school, may not find the proximity to a good public school necessary. Some items to look at are how close you are to markets, malls, beach, workplace or hospitals. Rank in the order of importance to you and use that as a measuring tool for how important one area is from another.Maintenance will change based on where you purchase your home. Condos, apartments or homes in various neighborhoods may have association or maintenance fees. These usually give you access to a number of other amenities such as but not limited to: a recreation center, pool, bbq pit, fitness center, or towards general maintenance of the area. This can be a good thing, but you must factor the extra cost into your budget. What’s Most Important to You?Rank SPAM from 1-4, 1 being the most important and 4 being the least important. Based on your rankings, assign a percentage to each letter based on the level of importance to you (Percentages must equal to 100%). There is no right or wrong answer for the percentages, only what you prefer. ExamplesS – 35%, P – 25%, A – 25%, M – 15%S – 20%, P – 35%, A – 30%, M – 15%S – 30%, P – 30%, A – 20%, M – 20%S – 15%, P – 40%, A – 35%, M – 10%Homework/Classwork1. Select Three Homes2. Calculate the Mortgage Payment3. Rank Your Three Homes4. Calculate the Overall Percentage of EACH home5. Assessing Each Home6. Create a Pros and Cons List and Use the JEE strategy (On wall) to select one of the homes1. Select Three Homes (You may use the two homes you found if they meet the parameters below)After you have ranked and assigned a percentage to each category it’s time to select a home. Use the following criteria to select a home that meets the course requirements and your personal requirements.On OahuFee Simple (FS), Not Leasehold (LH)$400,000Minimum 2 bedrooms, 1.5 baths2 Parking StallsGood neighborhoodNear the freeway, but not next to a freewayIn-home washer and dryer accessibility2. Calculate Mortgage Payment using | Click to see Mortgage CalculatorFor EACH of the three homes calculate the mortgage as seen below: provide the Total Out-of-Pocket1. 30 year mortgage, Down Payment $0, 5% Annual Interest Rate; PMI 0.5%; home insurance $1200/year; Other $02. 30 year mortgage, Down Payment 20%, 5% Annual Interest Rate; home insurance $1200/year; Other $0 *** Note: You should have 2 different amounts/payments per house; 6 total3. Ranking and calculating your HOMES according to SPAMAfter you have calculated all three homes you are to rank them based upon the SPAM ratings. When ranking homes we user a scale of 1-10. However, we use the number 5 to represent a category that meets your requirements. Use the chart below:6-10 – Above Requirements5 – Meets Requirements1-4 – Below RequirementsFor each category of SPAM, give a rating from 1-10. Remember, 5 meets your requirement. Ex. S – 5, P – 7, A – 5, M – 84. Calculating your HOMES according to SPAMHomes that simply meet your requirements will score a 50% in your overall ratings. Homes above 50% represent homes that you consider of value and worth living in. Homes below 50% represent homes that do not meet your requirements and most likely will not be considered for purchasing or living in.If your percentages ratings for SPAM were:S – 20%S – 5 S: 5/10 x 20 = 10%P – 30%P – 6 P: 6/10 x 30 = 18%A – 40%A – 6 A: 6/10 x 40 = 24%M – 10%M – 8 M: 8/10 x 10 = 8%Total Overall % = 60%To calculate your overall percentage for each home see the following example below:1. Take the rating for your letter and divide by 10 (5/10 – from above). 2. Then multiply by your percentage that you assigned to the letter (20% - from above)3. Add each percentage to the others to get your overall percentage.5. Assessing Each HomeOne thing to understand is that just because a home has a higher percentage, this does not mean it is the best home for you. Be sure to look at the categories that you have assigned the greatest weight (%) to determine which categories matter most. In some cases, you may select a home with a lower overall percentage because an important category or categories were most important.6. Create a Pros and Cons List and Use the JEE strategy (On wall) to select one of the homesCreate a Pros and Cons list to compare all three homes. Use the JEE Strategy format to then write a 3-4 paragraphs about which home you will select and the reasons for selecting that home. Remember, this will be one of the biggest expenses in your entire life. ................
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