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Fred decided on purchasing a $175,000 home. At closing he brought a check for $8390. The closing costs were as follows:

Title fee $545

Processing Fee $1900

Appraisal $695

Based on this information, how many points did Fred purchase?

A.3

B.1

C.0

D.2

Verified Answer :

ChuDunnoMe

the answer is 3 fam. ~ Apex

jepessoa

Answer:

A) 3

Explanation:

Fred first had to cover the closing costs that added up to $3,140, which means that he had $5,250 to buy some mortgage points. Mortgage points are used to lower monthly mortgage payments. One point costs 1% of the total mortgage loan. So each point will cost Fred $1,750, therefore he will be able to purchase 3 points with $5,250 (= $5,250 / $1,750 = 3).

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