Final answer:
If Mr. and Mrs. Zeller choose not to buy a point, it means they are opting not to pay an upfront fee to lower their monthly mortgage payment. By not buying a point, they would pay $10 more per month compared to if they had bought a point.
Step-by-step explanation:
If Mr. and Mrs. Zeller choose not to buy a point, despite the slightly lower monthly payment with points, they may prioritize short-term affordability over long-term savings. By forgoing the point, they opt for a higher monthly payment, but this decision could indicate a preference for immediate financial flexibility or a desire to allocate funds elsewhere. It may suggest that they are comfortable with the slightly higher monthly expense and value liquidity or discretionary spending in the present, rather than maximizing savings over the entire loan duration.
In this case, their monthly payment would be $1,160. By not buying a point, they would pay $10 more per month compared to if they had bought a point. Buying a point involves paying 1% of the loan amount upfront in exchange for a lower interest rate. In this scenario, the Zellers would pay $1,150 per month, saving $10 per month compared to the no point option.