Question

Jake and Janet are required to pay 4 points on the $80,000 loan they are getting. What will they have to pay the lender?

Answer 1

$3,200

Step-by-step explanation:

Data provided in the question:

Points to be paid to lender = 4 points

Amount of loan Jake and Janet are getting = $80,000

Now,

1 point mean 1 percent of the amount borrowed to be paid to the lender

Therefore,

For 4 points

Amount to be paid to the lender will be

= 4% × $80,000

or

= 0.04 × $80,000

or

= $3,200