Question 1

Use the following two columns of items to answer the matching questions below:
-amortization schedule

Accepted Answer

A) schedule of payments, interest expense, and balance 
B) fixed interest rate until maturity 
A) schedule of payments, interest expense, and balance 
B) fixed interest rate until maturity

Question 2

All the following information,except ________,can be found on a variety of Web sites about mortgages.

Accepted Answer

A)  projected rate increases 
B)  loan rates, length of loan, and principal 
C)  loan applications 
D)  background on different mortgage companies 
A)  projected rate increases 
B)  loan rates, length of loan, and principal 
C)  loan applications 
D)  background on different mortgage companies

Question 3

As a result of the financial crisis of 2008-2009,some financial institutions accepted a(n)________ arrangements in which the lender accepted the proceeds of the sale of a home as full payment on the debt owed even though the proceeds were less than the debt owed.

Accepted Answer

A)  mortgage modification 
B)  foreclosure 
C)  refinancing 
D)  short-sale 
A)  mortgage modification 
B)  foreclosure 
C)  refinancing 
D)  short-sale

Question 4

An advantage of using online real estate services is that

Accepted Answer

A)  you have easier access to qualified real estate agents. 
B)  the commissions and fees are often less than those charged by traditional full-service real estate agents. 
C)  your chances of selling a house are about 50% greater. 
D)  you will get a higher price for houses sold or pay lower prices for houses bought. 
A)  you have easier access to qualified real estate agents. 
B)  the commissions and fees are often less than those charged by traditional full-service real estate agents. 
C)  your chances of selling a house are about 50% greater. 
D)  you will get a higher price for houses sold or pay lower prices for houses bought.

Question 5

A sales contract stipulates not only the price offered for a home,but also the repairs to be completed and the move-in date requested by the buyer.

Accepted Answer

A) True 
 B)False

Question 6

The specific location of your home can influence the amount of property taxes and insurance you will pay.

Accepted Answer

A) True 
 B)False

Question 7

Annual property taxes for homes are usually

Accepted Answer

A)  less than 0.5% of the home value. 
B)  0.5% to 1% of the home value. 
C)  1% to 2% of the home value. 
D)  greater than 2% of the home value. 
A)  less than 0.5% of the home value. 
B)  0.5% to 1% of the home value. 
C)  1% to 2% of the home value. 
D)  greater than 2% of the home value.

Question 8

Which of the following is true?

Accepted Answer

A)  Loan origination fees are around 10-20 percent. 
B)  Loan application fees range from $100 to $500. 
C)  Points are $100-$200 per $1,000 of the home's value. 
D)  Appraisal costs range between 15% and 20% of the value of the home. 
A)  Loan origination fees are around 10-20 percent. 
B)  Loan application fees range from $100 to $500. 
C)  Points are $100-$200 per $1,000 of the home's value. 
D)  Appraisal costs range between 15% and 20% of the value of the home.

Question 9

Buying a home may be the single biggest investment you will ever make,so the decision should be taken very seriously.

Accepted Answer

A) True 
 B)False

Question 10

Making extra mortgage payments does which of the following?

Accepted Answer

A)  Increases the total amount of interest paid 
B)  Reduces the length of the loan 
C)  Decreases net worth 
D)  Increases the points charged 
A)  Increases the total amount of interest paid 
B)  Reduces the length of the loan 
C)  Decreases net worth 
D)  Increases the points charged

Question 11

When buying a home,all of the following are factors one should consider,except

Accepted Answer

A)  considering a condominium as an alternative to purchasing a house. 
B)  once you decide how much you can afford, identifying a specific home you desire. 
C)  borrowing as much as the lender is willing to loan you since the mortgage interest is tax deductible and may result in a larger tax refund. 
D)  evaluating the homes for sale in your target area. 
A)  considering a condominium as an alternative to purchasing a house. 
B)  once you decide how much you can afford, identifying a specific home you desire. 
C)  borrowing as much as the lender is willing to loan you since the mortgage interest is tax deductible and may result in a larger tax refund. 
D)  evaluating the homes for sale in your target area.

Question 12

Government-backed mortgages may require lower down payments than conventional mortgages,but usually charge higher interest rates.

Accepted Answer

A) True 
 B)False

Question 13

Most real estate agents agree that location is the most important influence on a home's future resale value.

Accepted Answer

A) True 
 B)False

Question 14

Real estate brokers usually offer good advice,but since they have a vested interest in you buying from them,you should also factor in your own judgment.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is most important when selecting a home?

Accepted Answer

A)  Taxes 
B)  Insurance 
C)  Resale value 
D)  Location 
A)  Taxes 
B)  Insurance 
C)  Resale value 
D)  Location

Question 16

Use the following two columns of items to answer the matching questions below:
-Points

Accepted Answer

A) title search and insurance, appraisal fee, and other costs 
B) fees that are a percentage of the purchase price and are paid by the borrower to the lender to obtain a reduction in the interest rate 
A) title search and insurance, appraisal fee, and other costs 
B) fees that are a percentage of the purchase price and are paid by the borrower to the lender to obtain a reduction in the interest rate

Question 17

Which of the following does not reflect the impact of a strong economy on home prices?

Accepted Answer

A)  There is a strong desire to purchase homes. 
B)  People are more confident that their jobs are secure. 
C)  People spend their money more conservatively. 
D)  It's easier to obtain financing. 
A)  There is a strong desire to purchase homes. 
B)  People are more confident that their jobs are secure. 
C)  People spend their money more conservatively. 
D)  It's easier to obtain financing.

Question 18

Describe how a mortgage and other related expenses affect a personal budget,income statement,and balance sheet.

Accepted Answer

Mortgage expense and taxes reduce your w

Question 19

Over the life of a mortgage,the payment to principal ________ and the portion to interest expense ________.

Accepted Answer

A)  increases; increases 
B)  decreases; increases 
C)  increases; decreases 
D)  decreases; decreases 
A)  increases; increases 
B)  decreases; increases 
C)  increases; decreases 
D)  decreases; decreases

Question 20

Is purchasing a home an expense,an investment,or both?

Accepted Answer

It is an expense since the interest expe

Exam 10: Purchasing and Financing a Home

Use the following two columns of items to answer the matching questions below: -amortization schedule

All the following information,except ________,can be found on a variety of Web sites about mortgages.

As a result of the financial crisis of 2008-2009,some financial institutions accepted a(n)________ arrangements in which the lender accepted the proceeds of the sale of a home as full payment on the debt owed even though the proceeds were less than the debt owed.

An advantage of using online real estate services is that

A sales contract stipulates not only the price offered for a home,but also the repairs to be completed and the move-in date requested by the buyer.

The specific location of your home can influence the amount of property taxes and insurance you will pay.

Annual property taxes for homes are usually

Which of the following is true?

Buying a home may be the single biggest investment you will ever make,so the decision should be taken very seriously.

Making extra mortgage payments does which of the following?

When buying a home,all of the following are factors one should consider,except

Government-backed mortgages may require lower down payments than conventional mortgages,but usually charge higher interest rates.

Most real estate agents agree that location is the most important influence on a home's future resale value.

Real estate brokers usually offer good advice,but since they have a vested interest in you buying from them,you should also factor in your own judgment.

Which of the following is most important when selecting a home?

Use the following two columns of items to answer the matching questions below: -Points

Which of the following does not reflect the impact of a strong economy on home prices?

Describe how a mortgage and other related expenses affect a personal budget,income statement,and balance sheet.

Over the life of a mortgage,the payment to principal ________ and the portion to interest expense ________.

Is purchasing a home an expense,an investment,or both?

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Auto and Homeowners Insurance

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

Filters

Over the life of a mortgage,the payment to principal and the portion to interest expense .