Question

Can someone help me out please?
Laurie is financing $360,000 to purchase a house. How much money will she save over the life of a
30-year, fixed-rate loan by buying 3 points with a rate of 6.275% instead of not buying points with a rate of 6.65%?

Answer Choices:
$31,906.80

$21,106.80

$13,990.68

$3,190.68

Answer 1

@dumbcow have any ideas or are you just viewing? lol

Answer 2

@Mertsj Think you might be able to help? It's financial algebra.

Answer 3

Sorry, I don't know this stuff but you can usually find it with google.

Answer 4

I had no luck with google :( know anyone that is good with this?

Answer 5

sorry yeah i can help, let me get my financial calculator :)

Answer 6

Thank youuu!

Answer 7

440078.40 interest paid at the 6.275 rate

Answer 8

ok with rate of 6.65% the total is $834,132.23
with rate of 6.275% along with adding 3% to loan for buying 3 points
total is $824,080.26

Answer 9

541589.26 interest paid at 6.65 rate

Answer 10

I'm confused since you both have two different answers :l

Answer 11

hmm i dont like any of your answer choices...i think i did it right

Answer 12

@Mertsj gave you the interest paid, i gave the total

i also added 10,800 to the loan amount, the cost for buying 3 points

Answer 13

nevermind i guess its assumed they pay that up front
new total for 6.275%
$800,077.92

but thats a savings of 34,054

Answer 14

wow i must have entered the wrong int rate :{
i double checked and new total for 6.65%

--> $831,986.47

savings of 31,908