Greg and Kathy Are Considering Purchasing a Home Requiring an $85,000

question 73

Multiple Choice

Greg and Kathy are considering purchasing a home requiring an $85,000 mortgage. The payment on a 30-year mortgage for this amount is $605. The payment for a 15-year mortgage is $752. What is the additional amount of interest paid on the 30-year mortgage?

• A) $82,440
• B) $52,920
• C) $135,360
• D) $26,460

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Definitions:

Mortgage

A mortgage is a loan specifically for purchasing real estate, where the property itself serves as collateral for the loan.

Real Property

Land and anything permanently attached to it, such as buildings.

Deed Of Trust

A formal written instrument that transfers legal ownership of real property to a third party while the mortgagor remains on the property. The third party holds certain rights to that property as security for the mortgagor’s creditors.

Disinterested Third Party

A disinterested third party is an unbiased individual or entity that is not involved in the matters at hand, ensuring impartiality in decision-making processes or disputes.