Exam 10: Purchasing and Financing a Home

Government-backed mortgages may require lower down payments than conventional mortgages, but usually charge higher interest rates.

During the financial crisis of 2008-2009, approximately ________% of subprime mortgages had late payments of at least 30 days.

Which of the following is the primary reason that a mortgage lender may allow a rate modification to an existing mortgage holder with a fixed-rate mortgage?

Since real estate brokers are licensed and bonded, they are required to give you unbiased information about real estate purchases.

In negotiating a price for the purchase of a home, you should do all of the following, except

When considering "how much home" you can afford, you should consider all of the following, except

Your monthly payments for a house are likely to be as high as rent when you factor in mortgage payments, property taxes, homeowner's insurance, and home repairs.

A fixed-rate mortgage usually has

If you are not planning to stay in your current house for very long, ________ would probably not be advantageous.

If the rent on an apartment is $600 per month, which is equal to a mortgage payment on a house, how much additional tax savings will you realize if $200 of the monthly mortgage payment is interest and your tax bracket is 24%, assuming your itemized deductions will exceed the standard deduction?

Financial planners advise that a home price should be no more than 4 times annual income.

Lucky Louie qualified for a $250,000 mortgage for his new home. The loan application was $400, closing attorney fee $500, appraisal fee $400, title insurance $1200, document fee $75, credit check $50. The loan requires a 1% origination fee plus 1 point (1 %) interest to buy down the rate. How much are Louie's total closing costs?

The purchase of a home represents a potential liability if you need to move quickly and the home does not appreciate rapidly in value.

When buying a home, all of the following are factors one should consider, except

A balloon payment mortgage starts with higher payments, which decrease as the mortgage is paid off.

When selling a home, which of the following costs will you incur?

To simplify and speed up the home-buying process, you should first make a verbal offer to see if the seller is willing to take the price you are willing to offer.

In comparing a 15- and 30-year mortgage, over the life of the loan you will have smaller payments but pay more interest with the 15-year mortgage.

Which of the following costs associated with home ownership is hardest to budget?

Points paid at closing represent