Real Estate Math
A seller agrees to pay 3.5 discount points on a buyer's $320,000 loan to buy down the interest rate. How much will the seller pay in points?
A$9,600
B$11,200✓ Correct
C$8,000
D$3,200
Explanation
Each discount point equals 1% of the loan amount. Points cost = $320,000 × 3.5% = $320,000 × 0.035 = $11,200. The seller is paying $11,200 to reduce the buyer's interest rate.
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