Amy purchased a house for $551,000 and obtained a mortgage for $519,000 she purchased 3 discount points and 2 origination points what is the cost for each? a. discount points: $16,530, origination points: $11,020b. discount points: $15,570: origination points: $10,380c. discount points: $11,020: origination points: $16,530d. discount points: $10,380: origination points: $15,579

Discount points are normally a type of prepaid interests that lowers the interest on subsequent payments for mortgage borrowers pay.

Each of the points is given by:

1 point = 1% of the mortgage value.

Therefore,
Cost of discount points = 0.01*519,000*3 = $15,570
Cost of origination points = 0.01*519,000*2 = $10,380

In this regard, option B. is the correct answer on the cost of discount and origination points respectively.

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