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1. Consider each of the following statements. Does the information in the three sources support the inference as stated?

Yes No Statements
The late payment fee assessed by the mortgage company is 2% of the total mortgage payment.
YES, the information support the inference


The previous owners were asking more than $179,000 for their property.
NO, the information do not support the inference


Making double payments on the principal in the first year would mean paying an extra $265 per month.
NO, the information do not support the inference


2. If the information contained in all three sources is correct and the first payment on the loan was made in January 2016, the down payment made on the purchase of the home was closest to:

A. $17,900
B. $21,600
C. $23,400
D. $29,000
E. $35,200

$273,610.80-$123,610.80 =$150,000
$179000-$150,000= $29,000 (D)

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1. Consider each of the following statements. Does the information in the three sources support the inference as stated?

A. The late payment fee assessed by the mortgage company is 2% of the total mortgage payment.

Late Payment fee = (999.00 - 978.79) / 978.79 = 0.021 = 2% (approx)...So, YES is the answer.


B. The previous owners were asking more than $179,000 for their property.

It has been only highlighted that 'The owners have accepted your bid of $179,000!'
So, it can't be inferred whether the owners were asking more than, or equal to $179,000 for their property....So, NO is the answer.


C. Making double payments on the principal in the first year would mean paying an extra $265 per month.

Making double payments on the Principal in the 1st year will amount to making an overall payment of
= $ 7111.39 + 2 * 2008.95 (ie, the Principal)
= $ 11129.29

Additional Outgo/month (to cater for double payment of the Principal amount) = $2008.95 /12
= $ 165.40....So, NO is the answer.

The answers wil be YES, NO and NO

2. If the information contained in all three sources is correct and the first payment on the loan was made in January 2016, the down payment made on the purchase of the home was closest to:

A. $17,900
B. $21,600
C. $23,400
D. $29,000
E. $35,200

TAB 2 highlights that
Total payments (against Loan) = $ 273610.80
Interest amount paid = $ 123610.80

So, the Principal Amount repaid = 273610.80 - 123610.80
= 150000
However, Total Cost of Home = 179000

It means Down Payment of $ (179000 - 150000) = $ 29000


The answer will be Option (D)

1. Consider each of the following statements. Does the information in the three sources support the inference as stated?
(a) The late payment fee assessed by the mortgage company is 2% of the total mortgage payment.
Actual mortgage payment is $978.79 whereas the late payment amount is $999.16.
The difference is 999.16 - 978.79 = $20.37
and \(\frac{20.37}{978.79}\)*100 = 2.08%.
Answer : YES

(b) The previous owners were asking more than $179,000 for their property.
Since the first tab mentions that "the owners have accepted your bid of $179,000!", so we can infer that the previous owners were expecting/asking more than $179,000.
Answer : YES

(c) Making double payments on the principal in the first year would mean paying an extra $265 per month.
The first year principal amount is $2008.95 which is equivalent to $167.4 per month. Therefore, double payments on the principal is not equal to $265 per month.
Answer : NO

2. If the information contained in all three sources is correct and the first payment on the loan was made in January 2016, the down payment made on the purchase of the home was closest to:
From tab 3 we find that the total of 360 payments is equal to $273,610.8 and the total interest component is $123,610.8
which means that the principal component is $273,610.8 - $123,610.8 = $150,000
Since, the bid value is $179,000 therefore, the down payment made on the purchase of the home is $29,000.
Answer D

Statement 1: Yes, The late payment fee assessed by the mortgage company is 2% of the total mortgage payment.

Payment Due = Monthly EMI + Escrow Payment
Late Payment Due= Monthly EMI+ Escrow Payment+ Late Fees
Late Fees= 999.16- (760.03 + 218.76)
Late Fees = $20.37
Total Mortgage Payment is $978.79
Required Percentage (20.37/978.79)*100 ~ 2% .

Statement 2: No, The previous owners were asking more than $179,000 for their property.

No information is provided about their previous asking price for the property, hence cannot be determined.

Statement 3: No, Making double payments on the principal in the first year would mean paying an extra $265 per month.
Principal to be repay in the first year =2008.95
Monthly Principal= 2008.95/12=167.41
Double the amount of principal, buyer has to pay additional 167.41 per month, this is not equal to the extra $265 per month.

2. If the information contained in all three sources is correct and the first payment on the loan was made in January 2016, the down payment made on the purchase of the home was closest to: Choice D. $29,000
Total Amount Paid= $ 273,610.80
Interest Amount= $ 123,610.80
Principal Amount= ($ 273,610.80- $123,610.80)
Principal Amount= $ 150,000
Bid Amount= $179,000
Downpayment= Bid Payment- Principal Payment
Downpayment = $179,000- $150,000
Downpayment= $ 29,000

QUESTION 1

A. The late payment fee assessed by the mortgage company is 2% of the total mortgage payment.

% for late payment vis-a-vis total mortgage payment
= ((Late payment amount) / 978.79) X 100
= (21.21 / 978.79) x 100
= 2%

Answer -- YES

B. The previous owners were asking more than $179,000 for their property.

No information given regarding the owners' demand; only information that the buyers' bid of $179,000 accepted by the owners.

It can't be ascertained that ' The previous owners were asking more than $179,000 for their property.'

Answer -- NO


C. Making double payments on the principal in the first year would mean paying an extra $265 per month.

Double payments of Principal = 2 x 2008.95 (Extra payment = $ 2008)

Total payment = 7111.39 + 2 x 2008.95 = 11129.29

Extra payment (per month) = 2008 /12 = $ 165 (approximately)

Answer -- NO

IMO, the overall correct options are YES, NO & NO

QUESTION 2

2. If the information contained in all three sources is correct and the first payment on the loan was made in January 2016, the down payment made on the purchase of the home was closest to:

A. $17,900
B. $21,600
C. $23,400
D. $29,000
E. $35,200


Given , Home Cost = 179000.........(1)

Overall paid (for Loan) = 273610.80
Interest = 123610.80

Principal Amount (for Loan) = 273610.80 - 123610.80
= 150000............(2)

Down Payment of = 179000 - 150000
= 29000


IMO, (D) is the correct option

Hello Everyone!

Good Morning/evening/afternoon.

OA to this question is posted, it is:

1. Yes, No, and No
2. D

Competition mode is off now.

Archit3110 you are a senior member and expect you to format your question properly.

RahulJain293 anything which the test taker is supposed to know to answer the question will be explained in the question during the official test. Here at this question you don't need to know what exactly "Escrow payment" means.

pintukr is topper on this question.

I like the format by pintukr and sivakumarm786 and I recommend other participant to follow pintukr format to answer and explain the question.

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