Question

Chuck obtained a mortgage of $90,000 to finance a $120,000 home. The title search will be $400, appraisal fee $500, application fee $900, and he will pay 1% origination fee. How much are his closing costs?

A) $900
B) $1,800
C) $2,700
D) $3,000

Answer 1

Chuck's closing costs are $2,700.

Step-by-step explanation:

To calculate Chuck's closing costs, we need to add up all the fees.

The origination fee is 1% of the mortgage amount, which is $90,000 x 0.01 = $900.

So the total closing costs are $400 (title search) + $500 (appraisal fee) + $900 (application fee) + $900 (origination fee) = $2,700.

Therefore, the correct answer is (C) $2,700.