Question

Closing Cost. Larry and Laurie have found a home ans made a $130,100 offer that has been accepted. They make a down payment of 15%. Their bank charges a loan origination fee of 0.7% of the loan and points of 1.8% (both are based on the loan amount). Other fees include a $25 loan application fee, a $270 appraisal fee, ans $370 for title search and insurance. How much cash will Larry and Laurie need at closing?

Answer 1

Down payment = Offer amount * percentage of down payment
= $130,100 * 15%
= $19,515

Mortgage amount = Offer amount -down payment
= $130,100 - $19,515
= $110,585

Origination fee = Mortgage amount * Percentage of Origination
= $110,585 * 0.7%
= $774.095

Points fee = Mortgage amount * Points %
= $110,585 * 1.8%
= $1,990.53

Cash needed at closing = Down payment + Origination Fee + Points Fee + loan application fee + appraisal fee + title search and insurance
= $19,515 + $774.095 + $1,990.53 + $25 + $270 + $370
= $22,944.625

Cash needed at closing = $22,944.625 or $22,944.63 (Rounded to 2 decimal places)

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