When discount points are paid, the bank collects a one-time fee at closing in exchange a lower mortgage rate to be honored for the life of the loan.
The banks consider this payment to be "prepaid mortgage interest". Meanwhile, mortgage interest is tax-deductible for eligible tax-filers so, for many mortgage borrowers, there's a tax advantage to paying discount points.
Answer:
Detailed step wise solution is given below:
Try measuring a different way, maybe with just cups
Answer:
Part 1: The entry fee is $5
Part 2: Each minute costs 25 cents
Step-by-step explanation:
In the expression, the '+5' represents the fee added to '.25m' the cost per each minute.