Molly is deciding between two loans.
Loan A $272,500 20-year fixed 6.45% 0 discount points M=$2023.67

Loan B $272,500 20-year fixed 6.125% 2 discount points M=$1971.98

Molly has calculated all of the associated fees as well as any other expenses. She has $5,500 available to purchase the points, and plans to stay in the house for half the length of the loan.

Which statement represents the best financial decision? (3 points)

Molly should purchase the discount points because doing so lowers her interest rate.

Molly should not purchase the discount points because she does not have enough available cash.

Molly should purchase the discount points because she will be in the house long enough to justify the purchase.

Molly should not purchase the discount points because she will not be in the house long enough to justify the purchase.