Question 1

Brian Pittman rents a living unit as a result of his membership in a nonprofit housing organization. What name is commonly used for this type of housing?

Accepted Answer

A)  modular housing 
B)  government-subsidized housing 
C)  zoned housing 
D)  a condominium 
E)  cooperative housing 
A)  modular housing 
B)  government-subsidized housing 
C)  zoned housing 
D)  a condominium 
E)  cooperative housing

Question 2

The most common service provided by a real estate agent when selling your home is

Accepted Answer

A)  providing legal advice. 
B)  qualifying buyers for a mortgage. 
C)  screening potential buyers. 
D)  making needed repairs. 
E)  getting you the lowest offer 
A)  providing legal advice. 
B)  qualifying buyers for a mortgage. 
C)  screening potential buyers. 
D)  making needed repairs. 
E)  getting you the lowest offer

Question 3

The Gross Debt Service (GDS) ratio measures:

Accepted Answer

A)  your monthly mortgage payment, including any outstanding debt as a percentage of gross monthly income. 
B)  your monthly mortgage payment, including principal, interest, heating, and taxes as a percentage of gross monthly income. 
C)  your monthly mortgage payment as a percentage of gross monthly income. 
D)  your annual mortgage payment, including any outstanding debt, as a percentage of gross annual income. 
E)  your annual mortgage payment, including principal, interest, heating, and taxes, as a percentage of gross annual income. 
A)  your monthly mortgage payment, including any outstanding debt as a percentage of gross monthly income. 
B)  your monthly mortgage payment, including principal, interest, heating, and taxes as a percentage of gross monthly income. 
C)  your monthly mortgage payment as a percentage of gross monthly income. 
D)  your annual mortgage payment, including any outstanding debt, as a percentage of gross annual income. 
E)  your annual mortgage payment, including principal, interest, heating, and taxes, as a percentage of gross annual income.

Question 4

Given the following, calculate the GDS ratio. All income and expense items are annual. $$\begin{array} { | l | r | l | r | } 
\hline \text { Gross income } & \mathbf { \$ 4 8 , 0 0 0 } & \text { Bank account } & \mathbf { \$ 1 , 0 0 0 } \
\hline \text { Net income } & \$ 38,000 & \text { Property taxes } & \$ 2,400 \
\hline \text { Heating } & \$ 3,600 & \text { Annual car payment } & \$ 4,200 \
\hline \text { Credit card balance } & \$ 2,500 & \text { Car loan balance } & \$ 10,000 \
\hline \text { Student loan payments } & \$ 2,400 & \text { Mortgage payments } & \$ 18,000 \
\hline
\end{array}$$

Accepted Answer

A)  28% 
B)  41% 
C)  50% 
D)  59% 
E)  64% 
A)  28% 
B)  41% 
C)  50% 
D)  59% 
E)  64%

Question 5

A lease does not protect tenants from rent increases during the term of the lease.

Accepted Answer

A) True 
 B)False

Question 6

Real estate agents will provide you with services using an hourly rate.

Accepted Answer

A) True 
 B)False

Question 7

Cooperative housing involves the renting of a living unit by the people involved in ownership of the building on a nonprofit basis.

Accepted Answer

A) True 
 B)False

Question 8

Assuming semi-annual compounding and a quoted mortgage rate of 9 percent, what are the effective annual rate and the effective monthly rate?

Accepted Answer

A)  4.5 percent, 1 percent 
B)  9 percent, 0.75 percent 
C)  9.2 percent, 0.736 percent 
D)  18.81 percent, 0.75 percent 
E)  18.81 percent. 0.736 percent 
A)  4.5 percent, 1 percent 
B)  9 percent, 0.75 percent 
C)  9.2 percent, 0.736 percent 
D)  18.81 percent, 0.75 percent 
E)  18.81 percent. 0.736 percent

Question 9

Renting is more advantageous than buying a home for

Accepted Answer

A)  lower short-term living costs. 
B)  financial benefits. 
C)  long-term investment purposes. 
D)  receiving tax benefits. 
E)  permanence of residence. 
A)  lower short-term living costs. 
B)  financial benefits. 
C)  long-term investment purposes. 
D)  receiving tax benefits. 
E)  permanence of residence.

Question 10

You made a $100,000 down payment on a $400,000 house and financed the remaining amount with a Canadian fixed-rate mortgage. Your mortgage has a term of three years, an amortization period of 25 years, a quoted rate of 7% and payments are made monthly. Identify the correct statement.

Accepted Answer

A)  The 7% quoted rate does not represent the effective annual rate charged on the mortgage. 
B)  The interest rate is fixed for 25 years. 
C)  You will make a total of 36 monthly payments to pay off the mortgage. 
D)  You have a high-ratio mortgage. 
E)  Your interest rate is fixed for 3 years, variable for 22 years. 
A)  The 7% quoted rate does not represent the effective annual rate charged on the mortgage. 
B)  The interest rate is fixed for 25 years. 
C)  You will make a total of 36 monthly payments to pay off the mortgage. 
D)  You have a high-ratio mortgage. 
E)  Your interest rate is fixed for 3 years, variable for 22 years.

Question 11

A home equity loan is also referred to as a ____________ mortgage.

Accepted Answer

A)  shared appreciation 
B)  graduated payment 
C)  growing equity 
D)  second 
E)  buy down 
A)  shared appreciation 
B)  graduated payment 
C)  growing equity 
D)  second 
E)  buy down

Question 12

Which of the following is typically excluded from a lease agreement?

Accepted Answer

A)  the conditions under which the landlord may enter the apartment. 
B)  the tenant's right to sublet the rental unit. 
C)  A list of utilities, appliances etc that are included in the rental amount. 
D)  the penalty for missing rental payments. 
E)  restrictions regarding specific activities (e.g. remodeling). 
A)  the conditions under which the landlord may enter the apartment. 
B)  the tenant's right to sublet the rental unit. 
C)  A list of utilities, appliances etc that are included in the rental amount. 
D)  the penalty for missing rental payments. 
E)  restrictions regarding specific activities (e.g. remodeling).

Question 13

The amount of mortgage a person is eligible for would be increased by

Accepted Answer

A)  higher interest rates. 
B)  a lower down payment. 
C)  high debt obligations. 
D)  a low family income. 
E)  lower interest rates. 
A)  higher interest rates. 
B)  a lower down payment. 
C)  high debt obligations. 
D)  a low family income. 
E)  lower interest rates.

Question 14

The gross debt service ratio is your monthly mortgage payment (including principal, interest, heating and taxes) as a percentage of your gross monthly income.

Accepted Answer

A) True 
 B)False

Question 15

Opportunity costs of housing can refer to time and effort involved in finding and repairing a place to live along with lost interest earnings on security deposits and down payments.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following would increase the amount that a person could afford to spend on a home?

Accepted Answer

A)  higher financial obligations 
B)  decreased interest rates 
C)  increased down payment 
D)  decreased family income 
E)  increased monthly living expenses 
A)  higher financial obligations 
B)  decreased interest rates 
C)  increased down payment 
D)  decreased family income 
E)  increased monthly living expenses

Question 17

Which of the following are disadvantages of home ownership?

Accepted Answer

A)  limited responsibility 
B)  few financial benefits 
C)  low initial costs. 
D)  limited mobility. 
E)  lifestyle flexibility. 
A)  limited responsibility 
B)  few financial benefits 
C)  low initial costs. 
D)  limited mobility. 
E)  lifestyle flexibility.

Question 18

The main financial benefit of renting is

Accepted Answer

A)  tax deductions. 
B)  increased equity. 
C)  investment value growth. 
D)  lower initial costs. 
E)  high financial commitment. 
A)  tax deductions. 
B)  increased equity. 
C)  investment value growth. 
D)  lower initial costs. 
E)  high financial commitment.

Question 19

Financial guidelines suggest that you should "spend no more than 10 to 20 percent of your take home pay on housing".

Accepted Answer

A) True 
 B)False

Question 20

The purpose of an appraisal is to

Accepted Answer

A)  estimate the current value of a home. 
B)  reduce the amount paid for property taxes. 
C)  qualify for a reduced mortgage rate. 
D)  eliminate the need for home insurance. 
E)  reduce the mortgage payments. 
A)  estimate the current value of a home. 
B)  reduce the amount paid for property taxes. 
C)  qualify for a reduced mortgage rate. 
D)  eliminate the need for home insurance. 
E)  reduce the mortgage payments.

Brian Pittman rents a living unit as a result of his membership in a nonprofit housing organization. What name is commonly used for this type of housing?

The most common service provided by a real estate agent when selling your home is

The Gross Debt Service (GDS) ratio measures:

A lease does not protect tenants from rent increases during the term of the lease.

Real estate agents will provide you with services using an hourly rate.

Cooperative housing involves the renting of a living unit by the people involved in ownership of the building on a nonprofit basis.

Assuming semi-annual compounding and a quoted mortgage rate of 9 percent, what are the effective annual rate and the effective monthly rate?

Renting is more advantageous than buying a home for

You made a $100,000 down payment on a $400,000 house and financed the remaining amount with a Canadian fixed-rate mortgage. Your mortgage has a term of three years, an amortization period of 25 years, a quoted rate of 7% and payments are made monthly. Identify the correct statement.

A home equity loan is also referred to as a ____________ mortgage.

Which of the following is typically excluded from a lease agreement?

The amount of mortgage a person is eligible for would be increased by

The gross debt service ratio is your monthly mortgage payment (including principal, interest, heating and taxes) as a percentage of your gross monthly income.

Opportunity costs of housing can refer to time and effort involved in finding and repairing a place to live along with lost interest earnings on security deposits and down payments.

Which of the following would increase the amount that a person could afford to spend on a home?

Which of the following are disadvantages of home ownership?

The main financial benefit of renting is

Financial guidelines suggest that you should "spend no more than 10 to 20 percent of your take home pay on housing".

The purpose of an appraisal is to

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source Credit: the Costs of Credit Alternatives

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

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Exam 7: The Finances of Housing

Brian Pittman rents a living unit as a result of his membership in a nonprofit housing organization. What name is commonly used for this type of housing?

The most common service provided by a real estate agent when selling your home is

The Gross Debt Service (GDS) ratio measures:

A lease does not protect tenants from rent increases during the term of the lease.

Real estate agents will provide you with services using an hourly rate.

Cooperative housing involves the renting of a living unit by the people involved in ownership of the building on a nonprofit basis.

Assuming semi-annual compounding and a quoted mortgage rate of 9 percent, what are the effective annual rate and the effective monthly rate?

Renting is more advantageous than buying a home for

You made a $100,000 down payment on a $400,000 house and financed the remaining amount with a Canadian fixed-rate mortgage. Your mortgage has a term of three years, an amortization period of 25 years, a quoted rate of 7% and payments are made monthly. Identify the correct statement.

A home equity loan is also referred to as a ____________ mortgage.

Which of the following is typically excluded from a lease agreement?

The amount of mortgage a person is eligible for would be increased by

The gross debt service ratio is your monthly mortgage payment (including principal, interest, heating and taxes) as a percentage of your gross monthly income.

Opportunity costs of housing can refer to time and effort involved in finding and repairing a place to live along with lost interest earnings on security deposits and down payments.

Which of the following would increase the amount that a person could afford to spend on a home?

Which of the following are disadvantages of home ownership?

The main financial benefit of renting is

Financial guidelines suggest that you should "spend no more than 10 to 20 percent of your take home pay on housing".

The purpose of an appraisal is to

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source Credit: the Costs of Credit Alternatives

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters