A housing down payment is money that a prospective buyer provides up front when purchasinga home and is usually a percent of the purchase price of the home. A lender typicallyrequires private mortgage insurance (PMI) when the buyer's down payment is less than20% of the purchase price. To secure a mortgage, buyers also need to have additionalcash on hand for closing costs and prepaid property tax. Suppose a buyer wants topurchase a $375,000 house and must have $7,200 on hand for closing costs and propertytax. Which of the following inequalities represents the total funds (f ) the buyer must have on hand to secure the mortgage without having to pay PMI?
A.
B.
C.
D.
Answer:B
A housing down payment is money that a prospective buyer provides up front when purchasinga home and is usually a percent of the purchase price of the home. A lender typicallyrequires private mortgage insurance (PMI) when the buyer's down payment is less than20% of the purchase price. To secure a mortgage, buyers also need to have additionalcash on hand for closing costs and prepaid property tax. Suppose a buyer wants topurchase a $375,000 house and must have $7,200 on hand for closing costs and propertytax. Which of the following inequalities represents the total funds (f ) the buyer must have on hand to secure the mortgage without having to pay PMI?
A. B. C. D.
Explanation: B