Megan Mei Is Charged 2 Points on a $120,000 Loan

question 85

Multiple Choice

Megan Mei is charged 2 points on a $120,000 loan at the time of closing. The original price of the home before the down payment was $140,000. The points in dollars cost Megan:

• A)$2,400
• B)$2,800
• C)$4,200
• D)$8,200
• E)None of these

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Definitions:

Reorganization Value

The value of a company's assets during a reorganization, reflecting their fair market value rather than book value.

Net Assets

The total assets of a company minus its total liabilities, representing the owners' or shareholders' equity.

Financial Affairs

The management and oversight of a person's or organization's money matters, including investments, budgets, and transactions.

Net Realizable Value

The estimated selling price of goods minus the cost of their sale or completion, used primarily in inventory valuation and accounts receivable.