Chapter 14.I, Problem 22RE

You are a real estate broker for Aurora Realty. One of your clients. Erica Heston, has agreed to purchase one of the homes your office has listed for sale for a negotiated price of $235,000. The down payment is $20\%$. and the balance will be financed with a 15-year fixed-rate mortgage at $8.75\%$ and $3\frac{1}{2}$ discount points. The annual property tax is $5,475. and the hazard insurance premium is $2,110. When Erica signed the original contract, she put down a deposit of $5,000. which will be credited to her down payment. In addition, at the time of closing. Erica must pay the following expenses:

Appraisal fee	$215
Credit report	$65
Roof inspection	$50
Mongage insurance premium	of amount financed
Title search	$125
Attorney's fees	$680
Escrow fee	$210
Prepaid interest	$630

As Erica’s real estate broker, she has asked you the following questions:

What is the total monthly PITI of the mortgage loan?

What is the total amount of interest that will be paid on the loan?

How much is due from Erica at the time of the closing?

If your real estate office is entitled to a commission from the seller of $6\frac{1}{2}\%$ of the price of the home, how much commission is made on the sale?