Final answer:
The loan origination fee for the Pickets, who are purchasing a home for $780,000 with a 90% loan, is $14,040. This is calculated by taking 2% of the loan amount they are receiving, which is 90% of the purchase price.
Step-by-step explanation:
The question involves finding out how much the loan origination fee is for the Pickets who are purchasing a home. The home costs $780,000 and they are getting a 90% loan from the lender at a 5% interest rate. The lender is also charging a 2% loan origination fee.
To calculate the loan origination fee, we must first determine the amount of the loan they are getting, which is 90% of the home's purchase price.
90% of $780,000 is calculated as follows:
$780,000 × 0.90 = $702,000
Now, we apply the 2% loan origination fee to the loan amount:
$702,000 × 0.02 = $14,040
Therefore, the loan origination fee that the Pickets will have to pay is $14,040.