For the purposes of estimating the effective borrowing cost (EBC), only those up-front expenses associated with obtaining the mortgage should be included, not the settlement costs associated with obtaining ownership of the property. With this in mind, which of the following costs should not be included in one's calculation of EBC?
A) Discount points
B) Loan origination fees
C) Appraisal fee
D) Buyer's title insurance

Question

Quizplus · Accepted Answer

Buyer's title insurance is a settlement cost associated with obtaining ownership of the property, and should not be included in the calculation of the effective borrowing cost (EBC). Only up-front expenses associated with obtaining the mortgage, such as discount points, loan origination fees, and appraisal fees, should be considered when calculating EBC.

For the Purposes of Estimating the Effective Borrowing Cost (EBC)