Question 1

Todd Foley is applying for a $100,000 mortgage.He can select either a $595 monthly payment with no points or a $515 payment with two points.How many months will it take Todd to cover the cost of the discount points if he takes the lower monthly payment?

Accepted Answer

A)  6
B)  10
C)  18
D)  25
E)  48F) A) and C)
G) A) and B)

Question 2

Renting would be most appropriate for people who:

Accepted Answer

A)  want more tax deduction benefits.
B)  desire to do their own maintenance and repairs.
C)  have limited initial funds available.
D)  enjoy remodeling their residence.
E)  desire unmonitored parties.F) A) and C)
G) All of the above

Question 3

Which procedure is a security measure if you are selling your home without a real estate professional?

Accepted Answer

A)  Closing the drapes when showing your home
B)  Turning off the lights when showing your home
C)  Showing your home only when two or more adults are at home
D)  Clearing the garage of clutter before showing your home
E)  Mowing the lawn before showing your homeF) A) and C)
G) B) and E)

Question 4

A real estate short sale occurs when:

Accepted Answer

A)  you are selling the home without a real estate professional.
B)  an appraisal is too costly to obtain.
C)  an estimate of the current value of the property is not available.
D)  the new selling price is less than the amount owed on a previous mortgage.
E)  the home is sold for less than the list price.F) B) and D)
G) C) and D)

Question 5

The purpose of a counteroffer is to:

Accepted Answer

A)  negotiate the purchase price.
B)  reduce mortgage payments.
C)  lower real estate property taxes.
D)  avoid paying points at closing.
E)  avoid paying the real estate agent's commission.F) None of the above
G) B) and E)

Question 6

A common cost associated with renting is:

Accepted Answer

A)  the down payment.
B)  closing costs.
C)  property taxes.
D)  maintenance costs.
E)  the security deposit.F) C) and E)
G) C) and D)

Question 7

As you determine how much of a home you can afford,consider the price of the house along with the quality and:

Accepted Answer

A)  size of the home.
B)  school zone.
C)  location of the home.
D)  local zoning laws.
E)  outdoor living area.F) C) and D)
G) B) and E)

Question 8

Which one of the following is an advantage of renting?

Accepted Answer

A)  Tax benefits
B)  Fewer responsibilities
C)  Increased value of real estate
D)  Increased maintenance costsE) All of the above
F) A) and B)

Question 9

A deed is the document that transfers ownership of the property from one party to another.

Accepted Answer

A) True 
 B)False

Question 10

A loan based on the high equity in a home that provides the homeowner with tax-free income and which is paid back when the home is sold or the homeowner dies is called a:

Accepted Answer

A)  conventional mortgage.
B)  growing equity mortgage.
C)  second mortgage.
D)  reverse mortgage.
E)  adjustable rate mortgage.F) None of the above
G) C) and D)

Question 11

What is the affordable monthly mortgage payment if your yearly gross income is $48,000 and monthly payments on an auto loan are $320?

Accepted Answer

A)  $4,800
B)  $4,000
C)  $1,500
D)  $1,200
E)  $320F) C) and D)
G) A) and C)

Question 12

The purpose of zoning laws is to:

Accepted Answer

A)  restrict property use.
B)  encourage new housing development.
C)  minimize people moving from an area.
D)  reduce real estate property taxes.
E)  assist real estate agents in finding homes for sale.F) C) and E)
G) All of the above

Question 13

Home improvements may or may not increase the selling price of the home.

Accepted Answer

A) True 
 B)False

Question 14

What is not true of lifestyle inflation?

Accepted Answer

A)  A salary increase is received
B)  Often results in increased debit
C)  Often results in lower amounts saved
D)  May result in overspending
E)  Helps to maintain a frugal level of spendingF) A) and B)
G) A) and D)

Question 15

What is the term used to describe the reduction of the balance owed on a loan with each payment made over a period of time?

Accepted Answer

A)  A buy-down
B)  Shared-appreciation
C)  Prepaid interest
D)  Amortization
E)  A rate capF) All of the above
G) C) and D)

Question 16

Which of the following is most commonly used as a base index for setting rates for adjustable rate mortgages?

Accepted Answer

A)  Federal Reserve Bank
B)  Karl's Mortgage Calculator
C)  Realtor.com
D)  London Interbank Offered Rate
E)  Bankrate.comF) None of the above
G) B) and D)

Question 17

John Ashford needs to sell his home because of a job transfer to another city.What actions should John take to prepare his home for selling?

Accepted Answer

Answers will vary
When selling a home, y...

Question 18

A home worth $250,000 with $100,000 still owed on the mortgage would have equity of:

Accepted Answer

A)  $250,000
B)  $200,000
C)  $150,000
D)  $100,000
E)  $80,000F) B) and C)
G) B) and E)

Question 19

An appraisal is likely to cost between:

Accepted Answer

A)  $100 - $200.
B)  $200 - $300.
C)  $300 - $400.
D)  $400 - $500.
E)  $500 - $600.F) B) and C)
G) C) and D)

Question 20

A cost associated with renting would be:

Accepted Answer

A)  property insurance.
B)  property taxes.
C)  down payment and closing costs.
D)  security deposit.
E)  mortgage interest.F) A) and C)
G) C) and E)

Exam 9: The Housing Decision: Factors and Finances

A common cost associated with renting is:

Correct AnswerverifiedShow Answer

Which of the following is most commonly used as a base index for setting rates for adjustable rate mortgages?

Correct AnswerverifiedShow Answer

What is the affordable monthly mortgage payment if your yearly gross income is $48,000 and monthly payments on an auto loan are $320?

Correct AnswerverifiedShow Answer

A home worth $250,000 with $100,000 still owed on the mortgage would have equity of:

Correct AnswerverifiedShow Answer

Todd Foley is applying for a $100,000 mortgage.He can select either a $595 monthly payment with no points or a $515 payment with two points.How many months will it take Todd to cover the cost of the discount points if he takes the lower monthly payment?

Correct AnswerverifiedShow Answer

The purpose of zoning laws is to:

Correct AnswerverifiedShow Answer

What is the term used to describe the reduction of the balance owed on a loan with each payment made over a period of time?

Correct AnswerverifiedShow Answer

What is not true of lifestyle inflation?

Correct AnswerverifiedShow Answer

A deed is the document that transfers ownership of the property from one party to another.

Correct AnswerverifiedShow Answer

A loan based on the high equity in a home that provides the homeowner with tax-free income and which is paid back when the home is sold or the homeowner dies is called a:

Correct AnswerverifiedShow Answer

Renting would be most appropriate for people who:

Correct AnswerverifiedShow Answer

John Ashford needs to sell his home because of a job transfer to another city.What actions should John take to prepare his home for selling?

Correct AnswerverifiedAnswers will varyWhen selling a home, y...View AnswerShow Answer

An appraisal is likely to cost between:

Correct AnswerverifiedShow Answer

A real estate short sale occurs when:

Correct AnswerverifiedShow Answer

As you determine how much of a home you can afford,consider the price of the house along with the quality and:

Correct AnswerverifiedShow Answer

The purpose of a counteroffer is to:

Correct AnswerverifiedShow Answer

A cost associated with renting would be:

Correct AnswerverifiedShow Answer

Which procedure is a security measure if you are selling your home without a real estate professional?

Correct AnswerverifiedShow Answer

Home improvements may or may not increase the selling price of the home.

Correct AnswerverifiedShow Answer

Which one of the following is an advantage of renting?

Correct AnswerverifiedShow Answer

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Answers will vary
When selling a home, y...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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