Exam 7: Selecting and Financing Housing

Carrie bought a house five years ago for $150,000. At that time she borrowed $140,000 from her bank. The house is now worth $162,000. Her PMI will automatically be dropped when her mortgage balance drops to

Diane purchased her house and had it assembled before it was moved to her lot. She purchased a

If your home is assessed for $200,000, the market value of the home should be less than $200,000.

Which of the following is a disadvantage of renting?

Marcus can afford a monthly mortgage payment of $900. If he is eligible for a 30-year, 5% mortgage (where the mortgage factor is 5.37), how much of a mortgage loan can he afford?

A reverse mortgage

An approved mortgage application usually locks in an interest rate for 60-120 days.

Your decision to rent or to buy your residence should be based solely on lifestyle factors.

Most new mortgages are assumable.

The Real Estate Settlement Procedures Act (RESPA) requires that loan applicants be given an estimate of the closing costs after the actual closing.

Mortgage points are paid to the lender at the end of the mortgage.

A landlord has the right to sublet an apartment.

The tenant is the

Private mortgage insurance is usually required if the down payment for a home is less than 30%.

An advantage of a second mortgage is that the interest rate subsidy from the home builder reduces the mortgage payments during the first few years of the loan.

If you have a $150,000 30-year 5% mortgage, how much of your first monthly payment of $805.50 would go toward principal?

During the closing for a home purchase , you should

With a downpayment of at least 5%, lenders use 33% of monthly gross income as a guideline for PITI (principal, interest, taxes, and insurance).

Kelly selected a home and submitted an offer to the seller.

What should a home buyer consider when evaluating a house?