The price of a home is 197000 The bank requires a 20 down pa

The price of a home is ?$197000. The bank requires a? 20% down payment and three points at the time of closing. The cost of the home is financed with a? 30-year fixed-rate mortgage at 9?%. Find the required down payment.

Solution

Down payment = 20%*$197,000= $39,400.

Loan Amount = $197,000 - $39,400 = $157,600

3 point mean 3% of amount financed has to be paid at closing = $157,600*3% = $4,728

total amount to be paid at closing = $39,400 + $4,728 = $44,128.