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A buyer wants to purchase a home for $400,000 with a 15% down payment. The lender charges 1.5 points. How much money does the buyer need up front to make the purchase?
Suggested Answer: D
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15 comments · newest first
RO
Rodney
1 month ago
I feel confident about this one now!
PO
Portia
1 month ago
Exactly! It’s important to include those points in the total.
UL
Ulysses
1 month ago
So, B) $66,000 is the answer?
RO
Rodney
2 months ago
Right! 1.5 points on $400,000 is $6,000. So total is $66,000.
PO
Portia
2 months ago
Yeah, the down payment is $60,000. But don’t forget the points!
UL
Ulysses
2 months ago
This question is tricky! I think it’s about calculating the down payment and points.
MA
Marylou
2 months ago
How do points even work? I'm confused!
LE
Leota
2 months ago
I calculated it as $66,000. Seems right to me!
KI
Kina
2 months ago
Wait, are we sure about the total upfront cost?
CO
Cory
3 months ago
Don't forget the points! That's an extra cost.
MI
Micaela
3 months ago
The down payment is $60,000.
FE
Fernanda
3 months ago
I believe the total upfront cost includes both the down payment and the points, so I think it might be closer to $66,000.
FI
Fidelia
3 months ago
I’m a bit confused about how to calculate the points. Is it based on the purchase price or the loan amount after the down payment?
FI
Fidelia
3 months ago
I remember doing a similar question where we had to calculate points. If the points are 1.5% of the loan amount, I think that adds a bit more to the upfront cost.
NI
Nilsa
4 months ago
I think the down payment is 15% of $400,000, which should be $60,000, but I’m not sure if I need to add the points to that.