On April 1 of next year, David is purchasing a $150,000 house and has accepted the Fourth Global Banks offer of a ten-year $124,500 loan with an interest rate of 5%. He has a gross annual income of $80,000 and is concerned about how much his one-time up-front costs and recurring monthly costs will be.

Hes received the following data and form, but hes not certain when he is to pay each costat closing, monthly, or both. Your task is to help David by completing the form and classifying the costs. Hint: Remember that the purchase is expected to close on the first of April. This means the following:

	Although a years worth of a cost, such as the houses property taxes, may be owed by the home buyer, a portion of the total cost will be paid by the seller.
	A portion of a cost, such as the homeowners insurance premium, may be deposited into an escrow account so that the accumulated funds will be available to pay the entire annual premium when it is due next year.
	For its mortgage, the bank will permit a 17% down payment but will also require 5 points. Mortgage insurance is required if the loan-to-value (LTV) ratio is less than 20%.
	A private mortgage insurance (PMI) policy, if necessary, is expected to cost $498 per year, but is distributed 12 times per year.
	David has purchased a home warranty policy, which carries an annual premium of $480 and is paid 12 times per year, and a homeowners insurance policy, which costs $1,500 per year. Premiums for these two policies are paid to the respective insurance companies from an escrow account at the bank.
	Credit report fee: $50
	Title search and deed recording fee: $375
	Loan origination fee: $750
	Title insurance policyLender: $300
	Mortgage payment (principal and interest): $1,323
	Appraisal and survey fees: $450
	Attorney fees: $1,000
	Home, termite, and radon Inspections: $525
	Title insurance policyHomeowner: $350
	Messenger and document fees: $235
	Property taxes on the house: $3,750 per year
	The property taxes and homeowners policy should be pro-rated.

Using the given information, what is the loan-to-value (LTV) ratio required by the Fourth Global Bank?

83.00%

17.00%

120.48%

Davids total closing costs are of his mortgage, and his monthly costs are of monthly income.