Question 1

An assumable loan is one that can be transferred to a new buyer who simply takes over the loan obligations.

Accepted Answer

A) True 
 B)False

Question 2

You have an option on an ARM that has a two-year adjustment interval, 4% margin, 2% periodic rate cap and a 6% lifetime cap. The current initial rate is 5.35%. You can also get a 30-year, fixed-rate mortgage for 6.65%. You plan on staying in this home for at least 10 years. What would be your best choice?

Accepted Answer

A)  Probably the ARM loan since your PITI would be lower. 
B)  Probably the ARM loan since your PITI would be lower and the market rates of interest could get lower. 
C)  Probably the fixed-rate loan because your PITI will be lower. 
D)  Probably the fixed-rate loan because it is easier to budget for and it is less risky for you. 
A)  Probably the ARM loan since your PITI would be lower. 
B)  Probably the ARM loan since your PITI would be lower and the market rates of interest could get lower. 
C)  Probably the fixed-rate loan because your PITI will be lower. 
D)  Probably the fixed-rate loan because it is easier to budget for and it is less risky for you.

Question 3

When following smart buying to purchase a home you should

Accepted Answer

A)  create a budget and determine what PITI you can afford. 
B)  check out your FICO score and get a copy of your credit report. 
C)  look at your overall financial plan to determine how big a loan you should take on. 
D)  determine how much of a down payment you can afford. 
E)  All of the above. 
A)  create a budget and determine what PITI you can afford. 
B)  check out your FICO score and get a copy of your credit report. 
C)  look at your overall financial plan to determine how big a loan you should take on. 
D)  determine how much of a down payment you can afford. 
E)  All of the above.

Question 4

A subprime mortgage is a mortgage with an APR below the prime rate.

Accepted Answer

A) True 
 B)False

Question 5

Name the steps in smart buying.

Accepted Answer

Step 1:Differentiate want from

Question 6

An attorney will draw up a contract for the purchase of a house. What provisions should you have in it?

Accepted Answer

-the price, method of payment, buyer and

Question 7

Carrying credit cards can increase impulse purchasing.

Accepted Answer

A) True 
 B)False

Question 8

Discuss why it is important to keep a clean credit record.

Accepted Answer

1.It provides a source of funds that mig

Question 9

Over the past decade, the number of new car sales are down and the number of new car leases are up. What is probably the main reason why this is true?

Accepted Answer

A)  The salesman makes a higher commission when cars are leased. 
B)  The manufacturers prefer it when people lease instead of purchase.. 
C)  New cars are getting so expensive that the average person can't afford to buy them. 
D)  Both A and B are correct. 
A)  The salesman makes a higher commission when cars are leased. 
B)  The manufacturers prefer it when people lease instead of purchase.. 
C)  New cars are getting so expensive that the average person can't afford to buy them. 
D)  Both A and B are correct.

Question 10

List the six keys to successful debt management.

Accepted Answer

1.Budget and spend less than you earn.
2

Question 11

With a(n) ________ mortgage, you make relatively small monthly payments for several years, after which the loan comes due and you must pay it off in one large payment.

Accepted Answer

A)  growing equity 
B)  option payment ARM 
C)  interest only 
D)  balloon payment 
A)  growing equity 
B)  option payment ARM 
C)  interest only 
D)  balloon payment

Question 12

Select the one cost that is not involved in home ownership.

Accepted Answer

A)  down payment 
B)  closing/settlement costs 
C)  rental deposit 
D)  points/discount points 
E)  loan origination fee 
A)  down payment 
B)  closing/settlement costs 
C)  rental deposit 
D)  points/discount points 
E)  loan origination fee

Question 13

A co-op would be a wise choice for a consumer who wishes to pay no property taxes.

Accepted Answer

A) True 
 B)False

An assumable loan is one that can be transferred to a new buyer who simply takes over the loan obligations.

When following smart buying to purchase a home you should

A subprime mortgage is a mortgage with an APR below the prime rate.

Name the steps in smart buying.

An attorney will draw up a contract for the purchase of a house. What provisions should you have in it?

Carrying credit cards can increase impulse purchasing.

Discuss why it is important to keep a clean credit record.

Over the past decade, the number of new car sales are down and the number of new car leases are up. What is probably the main reason why this is true?

List the six keys to successful debt management.

With a(n) ________ mortgage, you make relatively small monthly payments for several years, after which the loan comes due and you must pay it off in one large payment.

Select the one cost that is not involved in home ownership.

A co-op would be a wise choice for a consumer who wishes to pay no property taxes.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: The Role of Open Credit

Using Consumer Loans: The Role of Planned Borrowing

Life and Health Insurance

Property and Liability Insurance

Investment Basics

Securities Markets

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: An Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Events Fitting the Pieces Together

Filters

Exam 8: The Home and Automobile Decision

An assumable loan is one that can be transferred to a new buyer who simply takes over the loan obligations.

When following smart buying to purchase a home you should

A subprime mortgage is a mortgage with an APR below the prime rate.

Name the steps in smart buying.

An attorney will draw up a contract for the purchase of a house. What provisions should you have in it?

Carrying credit cards can increase impulse purchasing.

Discuss why it is important to keep a clean credit record.

Over the past decade, the number of new car sales are down and the number of new car leases are up. What is probably the main reason why this is true?

List the six keys to successful debt management.

With a(n) ________ mortgage, you make relatively small monthly payments for several years, after which the loan comes due and you must pay it off in one large payment.

Select the one cost that is not involved in home ownership.

A co-op would be a wise choice for a consumer who wishes to pay no property taxes.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: The Role of Open Credit

Using Consumer Loans: The Role of Planned Borrowing

Life and Health Insurance

Property and Liability Insurance

Investment Basics

Securities Markets

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: An Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Events Fitting the Pieces Together

Filters