A buyer purchases a home for $280,000 using an FHA loan with the minimum 3.5 percent down payment. What is the buyer's loan amount?
Correct Answer
D) $270,200
Down payment = $280,000 × 3.5% = $9,800. Loan amount = $280,000 - $9,800 = $270,200.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A comparison of the major mortgage loan types—conventional, FHA, VA, and USDA—covering their eligibility requirements, down payment amounts, mortgage insurance rules, and best use cases.
Predatory lending refers to unfair, deceptive, or abusive lending practices that impose unjustified terms on borrowers, often targeting vulnerable populations. It includes practices like excessive fees, inflated appraisals, and unnecessary refinancing.
RESPA is a federal law that requires lenders to provide borrowers with information about settlement costs, prohibits kickbacks and referral fees, and limits escrow account deposits. It applies to federally related mortgage loans.
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