Real Estate Math
A buyer purchases a home for $430,000, putting 10% down and financing the rest. The lender requires PMI at 0.8% annually of the loan amount. What is the annual PMI cost?
A$2,864
B$3,096✓ Correct
C$3,440
D$3,800
Explanation
Loan amount = $430,000 × 90% = $387,000. Annual PMI = $387,000 × 0.008 = $3,096. To solve this, multiply the relevant values: $430,000, at 10%.. The correct answer is $3,096.. This is a common calculation on the Ohio real estate exam.
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