What amount of per diem interest must Monet pay at closing for her mortgage loan?

To determine the per diem interest Monet must pay at closing for her mortgage loan, it's essential to understand what per diem interest is. Per diem interest is the amount of interest that accrues on a loan each day, calculated based on the loan amount, the interest rate, and the number of days from the closing date to the start of the first mortgage payment.

The calculation usually involves the following steps:

1. Determine the loan amount.
2. Find the annual interest rate.
3. Convert the annual interest rate to a daily rate by dividing by 365 days.
4. Multiply the daily interest rate by the loan amount to find the daily interest payment.
5. Finally, multiply the daily interest payment by the number of days until the first mortgage payment is due.

In this case, if the correct answer is $120.55, it suggests that the calculations based on Monet's specific loan parameters (loan amount, interest rate, and the number of days until the first payment) yielded this result. This information might have included the exact loan amount, interest rate, and closing date to arrive at the accurate per diem interest required at closing.

It's crucial for loan originators to be precise with these calculations, as it directly affects how much the borrower must