142 Unit 2 Managing Your Money Applications Name front. This prepaid interest Many mortgage lenders offer a way to lower your interest rate by paying some of the interest up paying a fee to lower known in the industry as points. Each point corresponds to 1% of the amount borrowed. In short, you're you, or for the lender. Let's look into it. 1. A lender offers you a 30-year fixed mortgage of $130.000 at 4% interest with no points. Find the monthly payment. 2. You can get the same 30-year mortgage of $130,000 at 3.6% interest by paying 2 points at closing. How much would you have to come up with to cover the 2 points? 3. Find the new monthly payment. 4. How much are you saving each month with the new monthly payment? s. How long will it take to recover the amount you had to come up with to pay the 2 points? What does this mean in terms of how long you should plan to stay in that home