Final answer:
To find the sale price of a property with an 80% LTV and a 20% down payment, we need the actual amounts of either the loan or the down payment. With just percentages and the cost for points provided, it is not possible to determine the property's sale price.
Step-by-step explanation:
The question asks us to determine the sale price of a property based on a loan-to-value (LTV) ratio of 80%, a down payment of 20%, and an additional $1,000 paid in cash for two points. To solve this, we need to set up equations based on the definitions of LTV and the down payment percentage. The LTV ratio represents the proportion of the property's value that is borrowed. An 80% LTV implies that 80% of the property's value is financed through a loan, and the remaining 20% is covered by the down payment. Since points are prepaid interest paid at the loan's inception, the $1,000 for two points is not directly relevant to the property's sale price.
Let's denote the sale price of the property as 'P'. Since the LTV is 80%, the loan amount would be 0.80P. The down payment is 20% of P, which can be written as 0.20P. Since the LTV plus the down payment add up to the full sale price (100%), the sale price can be calculated as:
P = loan amount + down payment
Therefore, if the loan amount is given by the LTV, we have:
P = 0.80P + 0.20P
P = 1.00P
Because the sale price equals 100% of itself, we know we have correctly accounted for both the financed amount and the down payment. Unfortunately, we cannot solve this equation without knowing either the loan amount or the down payment in actual numbers. Since the question does not provide this essential information, it is not possible to calculate the exact sale price of the property from the data given. The additional $1,000 paid for two points does not impact the calculation of the sale price since points relate to the financing costs of the loan, not the property's sale value.