Question

The purchase price of a condominium is $120,000. a down payment of 26% is made. the bank charges $730 in fees plus 2 1 2 points. find the total of the down payment and the closing costs. (round your answer to the nearest cent.) $

Answer 1

The total of the down payment and closing costs for a $120,000 condominium with a 26% down payment is $34,150. This includes the down payment of $31,200, bank fees of $730, and points costing $2,220.

Step-by-step explanation:

To find the total of the down payment and the closing costs for a condominium priced at $120,000 with a 26% down payment, we need to calculate each component.

• Down payment: $120,000 × 0.26 = $31,200
• Bank fees: $730
• Points charged: 2.5 points (1 point equals 1% of the loan amount; hence, 2.5 points is 2.5% of the loan amount after the down payment).

First, let's determine the loan amount after the down payment:

Loan amount = Purchase price - Down payment = $120,000 - $31,200 = $88,800

Now, let's calculate the points:

2.5 points = 2.5% of $88,800 = $88,800 × 0.025 = $2,220

Adding up the down payment, bank fees, and points gives us the total closing costs:

Total = Down payment + Bank fees + Points = $31,200 + $730 + $2,220 = $34,150

Therefore, the total of the down payment and closing costs is $34,150, rounded to the nearest cent.