Sebastian Warren

Mathematics

30 October, 12:38

A lender estimates the closing costs on a home loan of $50,000 as listed below.

Closing Cost

Charge

Loan origination

$200

Title insurance

$530

Attorney's fees

$600

Appraisal

$265

Inspection

$575

Recording fees

$130

Escrow

$800

If the lender's good faith estimates are accurate, are they a reasonable amount for closing costs? Why or why not?

a.

Yes, because the lender esitmated 3.08% of the home loan in closing costs which falls between 3 - 5%.

b.

Yes, because the lender estimated 4.6% of the home loan in closing costs which does not fall between 3 - 5%.

c.

No, because the lender estimated 6.2% of the home loan in closing costs which does not fall between 3 - 5%.

d.

No, because the lender estimated 17.7% of the home loan in closing costs which does fall between