Question 1

If the roof of your condominium building needs expensive repairs,then the condominium board will pay for repairs at no expense to you.

Accepted Answer

A) True 
 B)False

Question 2

Subprime mortgages are mortgages taken out by people with low credit scores.

Accepted Answer

A) True 
 B)False

Question 3

When planning your budget to determine how much your home will cost you every month,which of the following should you include in your planning?

Accepted Answer

A) Closing costs 
B) PITI 
C) Discount points 
D) All of the above 
A) Closing costs 
B) PITI 
C) Discount points 
D) All of the above

Question 4

A ________ mortgage is designed to let the homeowner pay off the mortgage early.Payments begin at the 30-year fixed rate,then increase each year.

Accepted Answer

A) balloon payment 
B) growing equity 
C) shared appreciation 
D) graduated payments 
E) conventional 
A) balloon payment 
B) growing equity 
C) shared appreciation 
D) graduated payments 
E) conventional

Question 5

In general,the maximum ratio the lender would like to see on a PITI to Monthly Gross Income is?

Accepted Answer

A) 30% 
B) 28% 
C) 33% 
D) 25% 
A) 30% 
B) 28% 
C) 33% 
D) 25%

Question 6

A(n)________ ARM combines the aspects of fixed-rate and adjustable-rate mortgages.

Accepted Answer

A) two-step 
B) convertible 
C) reduction-option 
D) option payment 
A) two-step 
B) convertible 
C) reduction-option 
D) option payment

Question 7

Another name for a closed-end lease is a(n)

Accepted Answer

A) take-out lease. 
B) walk-away lease. 
C) end-purchase lease. 
D) terminal lease. 
E) none of the above. 
A) take-out lease. 
B) walk-away lease. 
C) end-purchase lease. 
D) terminal lease. 
E) none of the above.

Question 8

Give the major financial advantages of home ownership.

Accepted Answer

Owning a home is one of the only true ta

Question 9

A mortgage with a 20% down payment will have a higher APR than one with less than 20% down.

Accepted Answer

A) True 
 B)False

Question 10

Name the steps in the housing decision.

Accepted Answer

Step 1:Pre-shopping homework
S

Question 11

Suppose that you were thinking about leasing a new vehicle.Which of the following should not be an important consideration?

Accepted Answer

A) I drive less than 15,000 miles annually. 
B) I like to get a new car every few years. 
C) I dislike the hassle of trading-in or selling cars. 
D) It's the only way I can afford the vehicle that I want. 
E) I dislike the hassle of maintenance. 
A) I drive less than 15,000 miles annually. 
B) I like to get a new car every few years. 
C) I dislike the hassle of trading-in or selling cars. 
D) It's the only way I can afford the vehicle that I want. 
E) I dislike the hassle of maintenance.

Question 12

Name the items that are deposited in an escrow account.

Accepted Answer

A) Principal,interest,title fee,insurance 
B) Utility payments,homeowner's association dues 
C) Property taxes,property insurance 
D) PMI premiums,homeowner's association dues 
E) Liens,closing costs,points 
A) Principal,interest,title fee,insurance 
B) Utility payments,homeowner's association dues 
C) Property taxes,property insurance 
D) PMI premiums,homeowner's association dues 
E) Liens,closing costs,points

Question 13

A key to negotiating a good price is?

Accepted Answer

A) Knowing the sales person 
B) Knowing how many are in stock 
C) Knowing the markup 
D) Knowing the retailers revenue 
A) Knowing the sales person 
B) Knowing how many are in stock 
C) Knowing the markup 
D) Knowing the retailers revenue

Question 14

Megan and Steve have found a home they want to purchase.The selling price is $320,000.They will put 20% down and get a 30 year,6% APR,monthly payment mortgage.Insurance is $1,800 per year and taxes are $3,000 per year.What is their monthly PITI?

Accepted Answer

A) $1,534.85 
B) $1,684.85 
C) $1,934.85 
D) $1,784.85 
A) $1,534.85 
B) $1,684.85 
C) $1,934.85 
D) $1,784.85

Question 15

________ is a publication that provides unbiased ratings and recommendations for a host of products and services.

Accepted Answer

A) USA Consumer 
B) Consumer Reports 
C) People Magazine 
D) Bloomberg Weekly 
A) USA Consumer 
B) Consumer Reports 
C) People Magazine 
D) Bloomberg Weekly

Question 16

Tell about the advantages of a shorter-term mortgage over a 30-year one.

Accepted Answer

A lower interest rate is common with a s

Question 17

In evaluating your financial history,lenders generally focus on which of the following?

Accepted Answer

A) Your income 
B) Your credit report 
C) Your FICO score 
D) All of the above 
A) Your income 
B) Your credit report 
C) Your FICO score 
D) All of the above

Question 18

Which of the following factors plays a role in determining the monthly lease payment of a car?

Accepted Answer

A) The agreed-upon price of the vehicle 
B) The length of the lease 
C) Your down payment plus any trade-in allowance or rebate 
D) The value of the vehicle at the end of the lease 
E) All of the above 
A) The agreed-upon price of the vehicle 
B) The length of the lease 
C) Your down payment plus any trade-in allowance or rebate 
D) The value of the vehicle at the end of the lease 
E) All of the above

Question 19

Regardless of what a potential borrower thinks he or she can afford,banks and other lenders impose a maximum amount that they will lend to a borrower based on the person's income and current debt levels.According the Keown book,what three factors do lenders look at when evaluating a potential borrower?

Accepted Answer

1.Financial history
2.Ability

Question 20

The rate cap on an ARM protects the borrower.

Accepted Answer

A) True 
 B)False

If the roof of your condominium building needs expensive repairs,then the condominium board will pay for repairs at no expense to you.

Subprime mortgages are mortgages taken out by people with low credit scores.

When planning your budget to determine how much your home will cost you every month,which of the following should you include in your planning?

A ________ mortgage is designed to let the homeowner pay off the mortgage early.Payments begin at the 30-year fixed rate,then increase each year.

In general,the maximum ratio the lender would like to see on a PITI to Monthly Gross Income is?

A(n)________ ARM combines the aspects of fixed-rate and adjustable-rate mortgages.

Another name for a closed-end lease is a(n)

Give the major financial advantages of home ownership.

A mortgage with a 20% down payment will have a higher APR than one with less than 20% down.

Name the steps in the housing decision.

Suppose that you were thinking about leasing a new vehicle.Which of the following should not be an important consideration?

Name the items that are deposited in an escrow account.

A key to negotiating a good price is?

Megan and Steve have found a home they want to purchase.The selling price is $320,000.They will put 20% down and get a 30 year,6% APR,monthly payment mortgage.Insurance is $1,800 per year and taxes are $3,000 per year.What is their monthly PITI?

________ is a publication that provides unbiased ratings and recommendations for a host of products and services.

Tell about the advantages of a shorter-term mortgage over a 30-year one.

In evaluating your financial history,lenders generally focus on which of the following?

Which of the following factors plays a role in determining the monthly lease payment of a car?

The rate cap on an ARM protects the borrower.

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 Eventsfitting the Pieces Together

Filters

Exam 8: The Home and Automobile Decision

If the roof of your condominium building needs expensive repairs,then the condominium board will pay for repairs at no expense to you.

Subprime mortgages are mortgages taken out by people with low credit scores.

When planning your budget to determine how much your home will cost you every month,which of the following should you include in your planning?

A ________ mortgage is designed to let the homeowner pay off the mortgage early.Payments begin at the 30-year fixed rate,then increase each year.

In general,the maximum ratio the lender would like to see on a PITI to Monthly Gross Income is?

A(n)________ ARM combines the aspects of fixed-rate and adjustable-rate mortgages.

Another name for a closed-end lease is a(n)

Give the major financial advantages of home ownership.

A mortgage with a 20% down payment will have a higher APR than one with less than 20% down.

Name the steps in the housing decision.

Suppose that you were thinking about leasing a new vehicle.Which of the following should not be an important consideration?

Name the items that are deposited in an escrow account.

A key to negotiating a good price is?

Megan and Steve have found a home they want to purchase.The selling price is $320,000.They will put 20% down and get a 30 year,6% APR,monthly payment mortgage.Insurance is $1,800 per year and taxes are $3,000 per year.What is their monthly PITI?

________ is a publication that provides unbiased ratings and recommendations for a host of products and services.

Tell about the advantages of a shorter-term mortgage over a 30-year one.

In evaluating your financial history,lenders generally focus on which of the following?

Which of the following factors plays a role in determining the monthly lease payment of a car?

The rate cap on an ARM protects the borrower.

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 Eventsfitting the Pieces Together

Filters