Hank, Whose Adjusted Gross Income Is $100,000, Purchases a New

Hank, whose adjusted gross income is $100,000, purchases a new principal residence in the current year for $250,000. He borrows $220,000 from a local mortgage company and pays loan origination fees of $1,600 and mortgage insurance premiums of $1,500. During the year, Hank pays $7,000 of interest on the loan. What is Hank's allowable interest deduction for the year?

A) $ 7,000
B) $ 7,750
C) $ 8,500
D) $ 8,600
E) $10,100