Answer to Question #255494 in Finance for Liki

Question #255494

The loan amount is 200,000, the down payment is 20,000 and the loan term is 30 years. The interest rate is 5%. To get the 30-year mortgage at 5%, we must pay 2 points at the time of closing. What is the cost of 2 points on the mortgage?

1
Expert's answer
2021-10-26T08:56:47-0400

Points represent a percentage of the entire loan amount

Points required=2

Loan amount =200000-20000=180000

Cost of two points=2%*180000

=3600


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