Question 1

How does smart buying improve your standard of living?

Accepted Answer

Following smart buying prevents you from

Question 2

Ben recently paid off his school loans and is looking to buy a home.He has qualified for an APR of 5.2% and plans on making payments for the next 15 years.He anticipates he can afford a monthly payment of $660.00.How much of a mortgage can Ben afford?

Accepted Answer

A)  $60,000 
B)  $82,371 
C)  $87,440 
D)  $91,000 
E)  None of the above 
A)  $60,000 
B)  $82,371 
C)  $87,440 
D)  $91,000 
E)  None of the above

Question 3

A mortgage for less than 80% of the appraised value of the home will not require PMI insurance because they default less often.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is not a one-time fee connected with purchasing a house?

Accepted Answer

A)  Down payment 
B)  Private mortgage insurance 
C)  Closing costs 
D)  Points 
E)  Origination fee 
A)  Down payment 
B)  Private mortgage insurance 
C)  Closing costs 
D)  Points 
E)  Origination fee

Question 5

Name the steps in the housing decision.

Accepted Answer

Step 1: Pre-shopping homework

Question 6

Nancy Wong has decided to move from her apartment into a house she is purchasing.She wants to enjoy the advantages of home ownership,such as

Accepted Answer

A)  a chance to build equity and wealth. 
B)  greater control over decorations and home improvement. 
C)  mortgage interest will probably be a tax deduction. 
D)  over time being able to take out a home equity loan to enjoy a tax deduction. 
E)  all of the above. 
A)  a chance to build equity and wealth. 
B)  greater control over decorations and home improvement. 
C)  mortgage interest will probably be a tax deduction. 
D)  over time being able to take out a home equity loan to enjoy a tax deduction. 
E)  all of the above.

Question 7

Stretching a car loan from 48 months to 60 months means the car will end up costing you more when you have paid in full.

Accepted Answer

A) True 
 B)False

Question 8

The rate cap on an ARM protects the borrower.

Accepted Answer

A) True 
 B)False

Question 9

Smart buying means buying what you want first and figuring out how you'll pay for it later.

Accepted Answer

A) True 
 B)False

Question 10

Hector a Maria have been married for almost one year now and are thinking about buying a house. Maria is an executive for a large, multi-national corporation with offices around the world. She has been told by her company that she will be transferred to a new location every three years. Hector is a car salesman and he is willing to move to wherever Maria gets transferred. Together they make $8,000 in gross monthly income and pay 40% in taxes and withholdings every month. Between them they have monthly payment of $400 in student loans and $700 in car loans, and their credit cards payments average $450 per month. They currently lease a luxury condo for $1,400 per month. They travel to Cancun every Christmas. Since they both work a lot of hours, they eat out at restaurants for most meals. They currently have nothing in savings but Hector's grandparents have said they will give them a 20% down payment for the new home.
-They have found a very nice town house available for $200,000.Assuming a 20% down payment and a 30-year fixed rate mortgage at 6.65%,what will their PITI be? Annual property taxes are $2,400 and homeowner's insurance premium is $900 per year.

Accepted Answer

A)  $1,027.14 
B)  $1,283.93 
C)  $1,302.14 
D)  $1,558.93 
A)  $1,027.14 
B)  $1,283.93 
C)  $1,302.14 
D)  $1,558.93

Question 11

What are some factors that determine whether a homeowner should refinance?

Accepted Answer

The typical rule of thumb is to refinanc

Question 12

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 s

Question 13

What questions should you answer before deciding to purchase a house?

Accepted Answer

A)  Will my life be stable or in transition in the next few years? 
B)  Is my job and the company I work for stable and secure? 
C)  Do I understand the responsibilities of home ownership? 
D)  All of the above are correct. 
A)  Will my life be stable or in transition in the next few years? 
B)  Is my job and the company I work for stable and secure? 
C)  Do I understand the responsibilities of home ownership? 
D)  All of the above are correct.

Question 14

Why may it be a good idea for newlyweds to lease a few years before purchasing a home together?

Accepted Answer

There are several good reasons for newly

Question 15

Private mortgage insurance is designed to protect the

Accepted Answer

A)  borrower. 
B)  lender. 
C)  lien holder. 
D)  all of the above. 
A)  borrower. 
B)  lender. 
C)  lien holder. 
D)  all of the above.

Question 16

Whether or not you itemize your tax deductions,you reap tax benefits due to the tax deductibility of the interest payments on your mortgage.

Accepted Answer

A) True 
 B)False

Question 17

You have been having significant problems with your new car.Every time you turn around something is breaking or not working properly.Fortunately,the "lemon laws" are there to help.Which of the following is not one of the criteria for application of the lemon laws?

Accepted Answer

A)  You have made at least four attempts to solve the problem. 
B)  Your car has been out of service for at least 30 days during the first year after purchase. 
C)  You have under 12,000 miles on the car. 
D)  You must return the vehicle to the original dealership. 
A)  You have made at least four attempts to solve the problem. 
B)  Your car has been out of service for at least 30 days during the first year after purchase. 
C)  You have under 12,000 miles on the car. 
D)  You must return the vehicle to the original dealership.

Question 18

Describe the keys to obtaining a "good" lease.

Accepted Answer

First,negotiate a fair agreed-upon value

Question 19

Are there any advantages in government-backed loans? Any disadvantages?

Accepted Answer

Yes,there are three advantages.One,the i

Question 20

As a general rule,your PITI shouldn't exceed 28% of your pretax monthly income.

Accepted Answer

A) True 
 B)False

How does smart buying improve your standard of living?

Ben recently paid off his school loans and is looking to buy a home.He has qualified for an APR of 5.2% and plans on making payments for the next 15 years.He anticipates he can afford a monthly payment of $660.00.How much of a mortgage can Ben afford?

A mortgage for less than 80% of the appraised value of the home will not require PMI insurance because they default less often.

Which of the following is not a one-time fee connected with purchasing a house?

Name the steps in the housing decision.

Nancy Wong has decided to move from her apartment into a house she is purchasing.She wants to enjoy the advantages of home ownership,such as

Stretching a car loan from 48 months to 60 months means the car will end up costing you more when you have paid in full.

The rate cap on an ARM protects the borrower.

Smart buying means buying what you want first and figuring out how you'll pay for it later.

What are some factors that determine whether a homeowner should refinance?

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

What questions should you answer before deciding to purchase a house?

Why may it be a good idea for newlyweds to lease a few years before purchasing a home together?

Private mortgage insurance is designed to protect the

Whether or not you itemize your tax deductions,you reap tax benefits due to the tax deductibility of the interest payments on your mortgage.

You have been having significant problems with your new car.Every time you turn around something is breaking or not working properly.Fortunately,the "lemon laws" are there to help.Which of the following is not one of the criteria for application of the lemon laws?

Describe the keys to obtaining a "good" lease.

Are there any advantages in government-backed loans? Any disadvantages?

As a general rule,your PITI shouldn't exceed 28% of your pretax monthly income.

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

Student and Consumer Loans: The Role of Planned Borrowing

Life and Health Insurance

Property and Liability Insurance

Investment Basics

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

How does smart buying improve your standard of living?

Ben recently paid off his school loans and is looking to buy a home.He has qualified for an APR of 5.2% and plans on making payments for the next 15 years.He anticipates he can afford a monthly payment of $660.00.How much of a mortgage can Ben afford?

A mortgage for less than 80% of the appraised value of the home will not require PMI insurance because they default less often.

Which of the following is not a one-time fee connected with purchasing a house?

Name the steps in the housing decision.

Nancy Wong has decided to move from her apartment into a house she is purchasing.She wants to enjoy the advantages of home ownership,such as

Stretching a car loan from 48 months to 60 months means the car will end up costing you more when you have paid in full.

The rate cap on an ARM protects the borrower.

Smart buying means buying what you want first and figuring out how you'll pay for it later.

What are some factors that determine whether a homeowner should refinance?

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

What questions should you answer before deciding to purchase a house?

Why may it be a good idea for newlyweds to lease a few years before purchasing a home together?

Private mortgage insurance is designed to protect the

Whether or not you itemize your tax deductions,you reap tax benefits due to the tax deductibility of the interest payments on your mortgage.

You have been having significant problems with your new car.Every time you turn around something is breaking or not working properly.Fortunately,the "lemon laws" are there to help.Which of the following is not one of the criteria for application of the lemon laws?

Describe the keys to obtaining a "good" lease.

Are there any advantages in government-backed loans? Any disadvantages?

As a general rule,your PITI shouldn't exceed 28% of your pretax monthly income.

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

Student and Consumer Loans: The Role of Planned Borrowing

Life and Health Insurance

Property and Liability Insurance

Investment Basics

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