Question

Anna purchased a house for $416,000 and obtained a mortgage for $394,000. She purchased 4 discount points and 5 origination points. What is the cost for each?

Answer 1

Cost of discount/origination points = 1% of the mortgage*number of pints in question.

In the current scenario:
Mortgage taken = $394,000
Discount points = 4
Origination points = 5

Then,
Cost of discount points = 0.01*394,000*4 = $15,760
Cost of origination points = 0.01*394,000*5 = $19,700