When taking out a home loan, you are able to buy points to lower your interest rate. One point will cost you $3,000. If you purchase three points, it will lower your monthly payment by $120. Ignoring the time value of money, what is the minimum length of time you will need to keep your loan to make it worth purchasing the points?
Group of answer choices:
5.8 years
5.4 years
6.3 years
7.1 years
2. Corrected_text: A buyer and seller agreed on a purchase price of $365,000 for a home. Unfortunately, the home only appraised for $360,000, and the seller is unwilling to lower the price. If the buyer's lender requires an 80% maximum Loan-to-Value ratio, what is the amount of the down payment the buyer must have?
Group of answer choices:
$78,000
$77,000
$73,000
$68,000
$72,000
3. Corrected_text: A borrower has $22,000 saved up for a down payment on a home. If her lender will allow a Loan-to-Value ratio of 95%, what is the maximum home price she can afford? (Ignore closing costs.)
Group of answer choices:
$396,000
$462,000
$440,000
$418,000
$410,000
Title_with_topic:
1. Home Loan Points and Minimum Length of Time
2. Purchase Price, Appraisal, and Down Payment
3. Down Payment and Maximum Home Price