Question

THE NICHOLS ARE BUYING A HOUSE SELLING FOR $245,000. THEY PAY A DOWN
PAYMENT OF $45,000 FROM THE SALE OF THEIR CURRENT HOUSE. TO OBTAIN A 15-
YEAR MORTGAGE AT 4.5% INTEREST, THEY MUST PAY 1.5 POINTS AT THE TIME OF
CLOSING. WHAT IS THE AMOUNT OF THE MORTGAGE, AND WHAT IS THE COST OF
THE 1.5 POINTS

Answer 1

The amount of the mortgage on this house is given as $300000, while the 1.5 points on the house is given as 3000 dollars

How to solve for the mortgage that is on this house

The data from the questions says that the cost of the house = $245000

The down payment amount amount is 45000

Given that they already paid 45000 from the cost of the house, the mortgage would be 245000 - 45000

= $200000

The cost of 1.5 points is the same as the cost of 1.5% of the mortgage of this house.

This is calculated as 0.015 x 200000

= $3000

The conclusion is that the amount of the mortgage on this house is given as $300000, while the 1.5 points on the house is given as 3000 dollars

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