Exam 5: Making Automobile and Housing Decisions

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -The key to negotiating a good price on a vehicle is knowing the [sticker price | dealer's cost].

A FHA loan is insured by the federal government.

A lender will usually require a loan-to-value ratio of ____ or less for you to avoid having to pay private mortgage insurance (PMI).

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -You made an $900 mortgage payment.The interest on the mortgage for this month was $850.You have just experienced [negative | positive] amortization.

Variable auto ownership costs are most dependent on

When buying a used car,it is very important to have it checked by a reputable mechanic.

The down payment is typically the only substantial housing cost that must be paid at the time of the purchase.

Which of the following is tax deductible if one itemizes deductions?

A condominium or townhome buyer will make monthly mortgage payments as well as pay a fee for services and maintenance of common areas.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Seeking mortgage preapproval [is | is not] recommended when you begin your house search.

When you receive title to an individual unit and joint ownership of any common areas and facilities,you have purchased a

As a homeowner,the federal government allows you to deduct interest expenses and taxes paid on the property.

One would be more likely to pay discount points if she expected

Commercial banks are an important source of both mortgage loans and interim construction loans.

Greg has negotiated a $20,000 price on a new pick-up truck.The manufacturer is offering a $1,500 rebate or 3.9 %,three-year financing.Greg is also able to get 7 %,three-year financing at his credit union.If Greg plans to finance $18,000 over three years,should he take the rebate or the 3.9 % financing? (Show all work. )

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -The average cost of owning is typically much less than leasing if you own the vehicle over [two | four] years.

Low-balling is a sales technique where the salesperson quotes a low price for a car then tries to get you to purchase a different,more expensive vehicle.

Which of the following is not associated with buying a home with a lower-than-typical down payment?

When refinancing your mortgage,you should consider

Start the negotiating process for either a purchase or a lease by telling the salesperson how much monthly payment you can afford.