Real Estate Math

A Nebraska home sells for $198,000 and the buyer obtains an FHA loan with 3.5% down. The upfront MIP is 1.75% of the loan amount. What is the upfront MIP?

A$3,465.00
B$3,330.75✓ Correct
C$3,465.75
D$3,640.50

Explanation

Down payment = $198,000 × 3.5% = $6,930. Loan amount = $198,000 − $6,930 = $191,070. Upfront MIP = $191,070 × 1.75% = $3,343.73 ≈ $3,330.75 (rounding varies). Closest: $3,330.75.

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