Question 1

A veteran might be able to buy a home with no down payment with ____________. ​

Accepted Answer

A) an FHA mortgage insurance 
B) a VA loan guarantee 
C) a buydown 
D) a conventional mortgage 
A) an FHA mortgage insurance 
B) a VA loan guarantee 
C) a buydown 
D) a conventional mortgage

Question 2

A(n)____________ ratio specifies the maximum percentage of the value of a property that a lender is willing to loan. ​

Accepted Answer

A) affordability 
B) loan-to-value 
C) rent 
D) mortgage points to closing costs 
A) affordability 
B) loan-to-value 
C) rent 
D) mortgage points to closing costs

Question 3

Janet is considering the purchase of a condo for $150,000 during a recession phase,partly financed by a mortgage.She is due to retire in a few years.If she cannot make her mortgage payments on time,she is bound to incur a ____________. ​

Accepted Answer

A) neutral equity on her property 
B) reduced residual value of the property 
C) higher rent ratio 
D) foreclosure of her house 
A) neutral equity on her property 
B) reduced residual value of the property 
C) higher rent ratio 
D) foreclosure of her house

Question 4

The first step in the auto-buying process should be:

Accepted Answer

A) to test-drive several automobiles. 
B) to begin negotiations on various automobiles. 
C) to decide whether to trade in your used car or to sell it yourself. 
D) to consider alternative buying strategies. 
E) to analyze how much you can afford to spend on the car. 
A) to test-drive several automobiles. 
B) to begin negotiations on various automobiles. 
C) to decide whether to trade in your used car or to sell it yourself. 
D) to consider alternative buying strategies. 
E) to analyze how much you can afford to spend on the car.

Question 5

When you lease your apartment from a nonprofit corporation that owns the building and you own a share of the nonprofit corporation,you own:

Accepted Answer

A) a single family home. 
B) a cooperative apartment. 
C) a condominium. 
D) a row house. 
E) a mobile home. 
A) a single family home. 
B) a cooperative apartment. 
C) a condominium. 
D) a row house. 
E) a mobile home.

Question 6

A financing made available by a builder or seller to a potential new-home buyer at interest rates well below market interest rates,often only for a short period is termed as a ____________. ​

Accepted Answer

A) conventional mortgage 
B) convertible ARM 
C) buydown 
D) two-step ARM 
A) conventional mortgage 
B) convertible ARM 
C) buydown 
D) two-step ARM

Question 7

If you made a down payment of $11,000 on a house worth $110,000,the lenders will require _____ because of the size of the down payment.

Accepted Answer

A) closing points 
B) a bond 
C) private mortgage insurance 
D) application fees 
E) homeowner's insurance 
A) closing points 
B) a bond 
C) private mortgage insurance 
D) application fees 
E) homeowner's insurance

Question 8

Leslie has been offered the choice of either a $1,000 rebate or a 5.5 percent,48-month loan for the new car she is purchasing.If Leslie will be financing $15,000 and can get a 7.5 percent,48-month loan at her credit union,should she take the $1,000 rebate or the 5.5 percent loan? (Show all work.)

Accepted Answer

Calculation of PMT for 7.5%,48-month loa

Question 9

Phil and Christina are recently married and are unsure of where they will be relocated after Christina finishes her residency in 9 months.Based on this information,which of the following housing recommendations would be most appropriate for them?

Accepted Answer

A) Renting a home 
B) Buying a condominium 
C) Sharing a single-family dwelling 
D) Leasing a cooperative apartment 
E) Purchasing a trailer 
A) Renting a home 
B) Buying a condominium 
C) Sharing a single-family dwelling 
D) Leasing a cooperative apartment 
E) Purchasing a trailer

Question 10

The Real Estate Settlement Procedures Act governs ____________ on owner-occupied houses,condominiums,and apartment buildings of four units or fewer. ​

Accepted Answer

A) mortgage closings 
B) mortgage rates 
C) the contingency clause 
D) the terms of prequalified loans 
A) mortgage closings 
B) mortgage rates 
C) the contingency clause 
D) the terms of prequalified loans

Question 11

Greg has negotiated a $20,000 price on a new pickup truck.The manufacturer is offering a $1,500 rebate or 3.9 percent,three-year financing.Greg is also able to get 7 percent,three-year financing from his credit union.If Greg plans to finance $18,000 over three years,should he take the 3.9 percent financing or the 7 percent financing? Show all work and round your answers to two decimal places.

Accepted Answer

Calculation of PMT for 3.9%,three-year f

Question 12

Which of the following is true of buying a used car as compared with a new car?

Accepted Answer

A) A used car will be in a better mechanical condition compared with a new car. 
B) A used car will have a higher residual value than a new car. 
C) The accessories in a new car will be better updated compared with those fitted in a new car. 
D) Purchasing a used car will be less expensive as compared with purchasing a new car. 
E) The fuel efficiency in a used car is always higher compared with that of a new car. 
A) A used car will be in a better mechanical condition compared with a new car. 
B) A used car will have a higher residual value than a new car. 
C) The accessories in a new car will be better updated compared with those fitted in a new car. 
D) Purchasing a used car will be less expensive as compared with purchasing a new car. 
E) The fuel efficiency in a used car is always higher compared with that of a new car.

Question 13

Lowballing is a sales technique where the salesperson quotes a low price for a car to get you to make an offer,and negotiates the price upward prior to signing the sales agreement.

Accepted Answer

A) True 
 B)False

Question 14

Kurt has $4,500 for a down payment and thinks he can afford monthly payments of $300.If Kurt can finance a vehicle with a 7 percent,4-year loan from the automobile dealer,what is the maximum amount he can afford to spend on the car? (Round off the answer to nearest units place.)

Accepted Answer

A) $12,528 
B) $14,400 
C) $16,028 
D) $17,028 
E) $18,028 
A) $12,528 
B) $14,400 
C) $16,028 
D) $17,028 
E) $18,028

Question 15

Assume that you have taken a car on a closed-end lease for a period of 5 years.At the end of the fifth year,you would need to pay additional money only ____________. ​

Accepted Answer

A) when the residual value is lower than expected 
B) when the residual value is more than expected 
C) when the mileage limits are exceeded 
D) when the mileage limits are not exceeded 
A) when the residual value is lower than expected 
B) when the residual value is more than expected 
C) when the mileage limits are exceeded 
D) when the mileage limits are not exceeded

Question 16

A foreclosure happens when:

Accepted Answer

A) the rates of interest prevalent in the housing market are extremely volatile,forcing the lender to demand additional collateral from the borrower. 
B) the lenders attempt to recover loan balances from the insolvent borrowers by forcing the sale of the home pledged as collateral. 
C) the borrowers repay their housing loan well before the estimated closing period of the loan. 
D) the value of a house is higher than the loan taken on the property. 
E) the borrower is planning to restructure the loan taken for making mortgage payments. 
A) the rates of interest prevalent in the housing market are extremely volatile,forcing the lender to demand additional collateral from the borrower. 
B) the lenders attempt to recover loan balances from the insolvent borrowers by forcing the sale of the home pledged as collateral. 
C) the borrowers repay their housing loan well before the estimated closing period of the loan. 
D) the value of a house is higher than the loan taken on the property. 
E) the borrower is planning to restructure the loan taken for making mortgage payments.

Question 17

The monthly interest on your adjustable-rate mortgage was $690.You paid $650 as your monthly payment on the loan leading to an increase in the principal balance.This is an example of:

Accepted Answer

A) a growing equity. 
B) a negative amortization. 
C) a fixed interest expense. 
D) a shrinking principal. 
E) an indexed equity. 
A) a growing equity. 
B) a negative amortization. 
C) a fixed interest expense. 
D) a shrinking principal. 
E) an indexed equity.

Question 18

Prequalification provides a home buyer with information regarding the specific mortgage amounts he or she is eligible for subject to the expected changes in interest rates.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is a type of down payment that lowers the potential depreciation and therefore your monthly lease payments on a leased car?

Accepted Answer

A) Money factor 
B) Property depreciation cost 
C) Initial residual value 
D) Purchase option 
E) Capital cost reduction 
A) Money factor 
B) Property depreciation cost 
C) Initial residual value 
D) Purchase option 
E) Capital cost reduction

Question 20

Variable auto ownership costs are dependent on:

Accepted Answer

A) the driver's behavior. 
B) the miles covered by the automobile. 
C) the instalment payments on car loan. 
D) the down payment. 
E) the periodic renewals of vehicle registration. 
A) the driver's behavior. 
B) the miles covered by the automobile. 
C) the instalment payments on car loan. 
D) the down payment. 
E) the periodic renewals of vehicle registration.

A veteran might be able to buy a home with no down payment with ____________.

A(n)____________ ratio specifies the maximum percentage of the value of a property that a lender is willing to loan.

Janet is considering the purchase of a condo for $150,000 during a recession phase,partly financed by a mortgage.She is due to retire in a few years.If she cannot make her mortgage payments on time,she is bound to incur a ____________.

The first step in the auto-buying process should be:

When you lease your apartment from a nonprofit corporation that owns the building and you own a share of the nonprofit corporation,you own:

A financing made available by a builder or seller to a potential new-home buyer at interest rates well below market interest rates,often only for a short period is termed as a ____________.

If you made a down payment of $11,000 on a house worth $110,000,the lenders will require _____ because of the size of the down payment.

Leslie has been offered the choice of either a $1,000 rebate or a 5.5 percent,48-month loan for the new car she is purchasing.If Leslie will be financing $15,000 and can get a 7.5 percent,48-month loan at her credit union,should she take the $1,000 rebate or the 5.5 percent loan? (Show all work.)

Phil and Christina are recently married and are unsure of where they will be relocated after Christina finishes her residency in 9 months.Based on this information,which of the following housing recommendations would be most appropriate for them?

The Real Estate Settlement Procedures Act governs ____________ on owner-occupied houses,condominiums,and apartment buildings of four units or fewer.

Which of the following is true of buying a used car as compared with a new car?

Lowballing is a sales technique where the salesperson quotes a low price for a car to get you to make an offer,and negotiates the price upward prior to signing the sales agreement.

Kurt has $4,500 for a down payment and thinks he can afford monthly payments of $300.If Kurt can finance a vehicle with a 7 percent,4-year loan from the automobile dealer,what is the maximum amount he can afford to spend on the car? (Round off the answer to nearest units place.)

Assume that you have taken a car on a closed-end lease for a period of 5 years.At the end of the fifth year,you would need to pay additional money only ____________.

A foreclosure happens when:

The monthly interest on your adjustable-rate mortgage was $690.You paid $650 as your monthly payment on the loan leading to an increase in the principal balance.This is an example of:

Prequalification provides a home buyer with information regarding the specific mortgage amounts he or she is eligible for subject to the expected changes in interest rates.

Which of the following is a type of down payment that lowers the potential depreciation and therefore your monthly lease payments on a leased car?

Variable auto ownership costs are dependent on:

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds, ETFS and Real Estate

Planning for Retirement

Preserving Your Estate

Filters

Exam 5: Making Automobile and Housing Decisions

A veteran might be able to buy a home with no down payment with ____________. ​

A(n)____________ ratio specifies the maximum percentage of the value of a property that a lender is willing to loan. ​

Janet is considering the purchase of a condo for $150,000 during a recession phase,partly financed by a mortgage.She is due to retire in a few years.If she cannot make her mortgage payments on time,she is bound to incur a ____________. ​

The first step in the auto-buying process should be:

When you lease your apartment from a nonprofit corporation that owns the building and you own a share of the nonprofit corporation,you own:

A financing made available by a builder or seller to a potential new-home buyer at interest rates well below market interest rates,often only for a short period is termed as a ____________. ​

If you made a down payment of $11,000 on a house worth $110,000,the lenders will require _____ because of the size of the down payment.

Leslie has been offered the choice of either a $1,000 rebate or a 5.5 percent,48-month loan for the new car she is purchasing.If Leslie will be financing $15,000 and can get a 7.5 percent,48-month loan at her credit union,should she take the $1,000 rebate or the 5.5 percent loan? (Show all work.)

Phil and Christina are recently married and are unsure of where they will be relocated after Christina finishes her residency in 9 months.Based on this information,which of the following housing recommendations would be most appropriate for them?

The Real Estate Settlement Procedures Act governs ____________ on owner-occupied houses,condominiums,and apartment buildings of four units or fewer. ​

Which of the following is true of buying a used car as compared with a new car?

Lowballing is a sales technique where the salesperson quotes a low price for a car to get you to make an offer,and negotiates the price upward prior to signing the sales agreement.

Kurt has $4,500 for a down payment and thinks he can afford monthly payments of $300.If Kurt can finance a vehicle with a 7 percent,4-year loan from the automobile dealer,what is the maximum amount he can afford to spend on the car? (Round off the answer to nearest units place.)

Assume that you have taken a car on a closed-end lease for a period of 5 years.At the end of the fifth year,you would need to pay additional money only ____________. ​

A foreclosure happens when:

The monthly interest on your adjustable-rate mortgage was $690.You paid $650 as your monthly payment on the loan leading to an increase in the principal balance.This is an example of:

Prequalification provides a home buyer with information regarding the specific mortgage amounts he or she is eligible for subject to the expected changes in interest rates.

Which of the following is a type of down payment that lowers the potential depreciation and therefore your monthly lease payments on a leased car?

Variable auto ownership costs are dependent on:

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds, ETFS and Real Estate

Planning for Retirement

Preserving Your Estate

Filters

A veteran might be able to buy a home with no down payment with ____________.

A(n)____________ ratio specifies the maximum percentage of the value of a property that a lender is willing to loan.

Janet is considering the purchase of a condo for $150,000 during a recession phase,partly financed by a mortgage.She is due to retire in a few years.If she cannot make her mortgage payments on time,she is bound to incur a ____________.

A financing made available by a builder or seller to a potential new-home buyer at interest rates well below market interest rates,often only for a short period is termed as a ____________.

The Real Estate Settlement Procedures Act governs ____________ on owner-occupied houses,condominiums,and apartment buildings of four units or fewer.

Assume that you have taken a car on a closed-end lease for a period of 5 years.At the end of the fifth year,you would need to pay additional money only ____________.