To determine Marvin's monthly PMI (Private Mortgage Insurance) payment, we need to follow these steps:
1. Calculate the Loan Amount:
Marvin is purchasing a home priced at [tex]$142,000 and making a down payment of $[/tex]17,000. This means the loan amount is calculated by subtracting the down payment from the home's price:
[tex]\[
\text{Loan Amount} = \text{Home Price} - \text{Down Payment}
\][/tex]
[tex]\[
\text{Loan Amount} = 142,000 - 17,000 = 125,000
\][/tex]
2. Determine the Base-to-Loan Percentage:
The Base-to-Loan percentage (also known as the Loan-to-Value ratio, or LTV) is a measure of how much financing is provided compared to the value of the home.
[tex]\[
\text{LTV} = \frac{\text{Loan Amount}}{\text{Home Price}} \times 100\%
\][/tex]
[tex]\[
\text{LTV} = \frac{125,000}{142,000} \times 100\% \approx 88\%
\][/tex]
3. Refer to the PMI Table:
Based on the determined LTV of approximately 88%, the PMI table would list the monthly PMI payment for a 30-year fixed-rate loan. From the given options:
- A. [tex]$54.17
- B. $[/tex]650
- C. [tex]$56.23
- D. $[/tex]52.90
According to the table, for our calculated LTV percentage, the closest and most appropriate PMI payment amount listed is $54.17.
Therefore, Marvin's monthly PMI payment is:
[tex]\[
\boxed{54.17}
\][/tex]
