39. A buyer purchases a house for $100000 and is approved for a loan of $75000. What is the amount charged for points with 2.5 discount points?
Answer: B
The amount charged for points with 2.5 discount points is $1,875.
When a buyer is charged discount points, it is calculated as a percentage of the loan amount. In this case, with a loan of $75,000 and a rate of 2.5 discount points, the total charged for points amounts to $1,875.
A) $625
This option represents a calculation of 1% of the loan amount, which is not applicable here. The correct percentage for 2.5 discount points is 2.5%, which results in a higher charge.
B) $1,875
This is the correct answer as it accurately reflects the calculation of 2.5% of the loan amount. Specifically, 2.5% of $75,000 equals $1,875, confirming that this option is accurate.
C) $2,250
This amount represents 3% of the loan amount, which exceeds the 2.5 discount points stated in the question. Therefore, this option is incorrect as it does not align with the given discount points.
D) $2,500
This option corresponds to 3.33% of the loan amount, which is also incorrect given that the applicable rate is only 2.5%. Thus, this option does not reflect the accurate calculation for the discount points.
Conclusion
The correct answer, $1,875, is derived from applying the 2.5% discount points to the loan amount of $75,000. All other options fail to accurately represent the calculation based on the provided discount points, confirming that they do not align with the correct financial computation.