Question 1

Sandra Smith wants to know the purpose of a title search.What would you tell her?

Accepted Answer

A) To gain a clear title to the property 
B) To make sure the person selling the property really owns it 
C) To protect you against challenges to the title 
D) All of the above 
A) To gain a clear title to the property 
B) To make sure the person selling the property really owns it 
C) To protect you against challenges to the title 
D) All of the above

Question 2

How much would the monthly payment be on a $400,000,5% APR,30 year mortgage?

Accepted Answer

A) $2,147.29 
B) $14,211.75 
C) $1,666.67 
D) $1,717.83 
A) $2,147.29 
B) $14,211.75 
C) $1,666.67 
D) $1,717.83

Question 3

The two most common types of two-step mortgages are the 8/22 and 12/18,in which lenders offer a lower interest rate for the first 8 or 12 years and then adjust the rate for the remaining 22 or 18 years.

Accepted Answer

A) True 
 B)False

Question 4

The two primary advantages of a 15-year mortgage over a 30-year mortgage are

Accepted Answer

A) lower payments and prepayment privileges. 
B) lower interest rate and lesser interest charges over the life of the loan. 
C) greater financial flexibility and no prepayment penalties. 
D) easier qualification criteria and more affordable initially. 
E) none of the above. 
A) lower payments and prepayment privileges. 
B) lower interest rate and lesser interest charges over the life of the loan. 
C) greater financial flexibility and no prepayment penalties. 
D) easier qualification criteria and more affordable initially. 
E) none of the above.

Question 5

Which of these is not an advantage associated with an assumable loan?

Accepted Answer

A) The new buyer does not incur the closing costs of a new loan. 
B) The new buyer may be able to get a lower interest rate than the current market rate. 
C) It is easier for the seller to sell the home. 
D) The new buyer does not have to qualify for the loan. 
A) The new buyer does not incur the closing costs of a new loan. 
B) The new buyer may be able to get a lower interest rate than the current market rate. 
C) It is easier for the seller to sell the home. 
D) The new buyer does not have to qualify for the loan.

Question 6

Why is important to determine your housing needs not only for the present but also for the next several years?

Accepted Answer

The closing costs and selling fees assoc

Question 7

When making a smart purchase you don't need to consider such charges as delivery fees,installation fees or service costs as these are already included in the purchase price.

Accepted Answer

A) True 
 B)False

Question 8

For most cars,the manufacturer's warranty extends through the first seven years of ownership or the first 70,000 miles,whichever comes first.

Accepted Answer

A) True 
 B)False

Question 9

An assumable loan is one that can be transferred to a new buyer who simply takes over the loan obligations.

Accepted Answer

A) True 
 B)False

Question 10

Open-end leases are leases in which you return the vehicle at the end of the lease and you have no further responsibilities.

Accepted Answer

A) True 
 B)False

Question 11

List the four steps in the automobile decision.

Accepted Answer

Step 1:Differentiate want from

Question 12

The typical down payment is 20% for traditional mortgage loans.

Accepted Answer

A) True 
 B)False

Question 13

Your ARM has a two year adjustment interval,4% margin,2% periodic rate cap and a 6% lifetime cap.This year the market interest index increased by 2.75%.What will happen to your APR on this loan?

Accepted Answer

A) It will increase by 2% 
B) It will increase by 2.75% 
C) It will increase by 4% 
D) It will increase by 6% 
A) It will increase by 2% 
B) It will increase by 2.75% 
C) It will increase by 4% 
D) It will increase by 6%

Question 14

Rhonda is buying a second home to use as income property.She is financing 75% of the home's $100,000 value.Her bank is loaning her the money for 10 years at an APR of 4.5%.How much are Rhonda's mortgage payments?

Accepted Answer

A) $441.28 
B) $598.74 
C) $777.28 
D) $958.44 
E) $1,014.33 
A) $441.28 
B) $598.74 
C) $777.28 
D) $958.44 
E) $1,014.33

Question 15

Based on their incomes,how large of a PITI can they comfortably afford to pay?

Accepted Answer

A) Based on the 36 percent rule,they can afford $1,330 per month. 
B) Based on the 36 percent rule,they can afford $2,880 per month. 
C) Based on the 28 percent rule,they can afford $1,344 per month. 
D) Based on the 36 percent rule,they can afford $1,728 per month. 
A) Based on the 36 percent rule,they can afford $1,330 per month. 
B) Based on the 36 percent rule,they can afford $2,880 per month. 
C) Based on the 28 percent rule,they can afford $1,344 per month. 
D) Based on the 36 percent rule,they can afford $1,728 per month.

Question 16

Kathy is buying her first home.She is financing a total of $185,000 at an APR of 5% for 25 years.How much are her monthly payments?

Accepted Answer

A) $952.33 
B) $1,081.49 
C) $1,441.23 
D) $1,664.85 
A) $952.33 
B) $1,081.49 
C) $1,441.23 
D) $1,664.85

Question 17

Smart buying means buying what you want first and figuring out how you'll pay for it later.

Accepted Answer

A) True 
 B)False

Question 18

They have found a very nice town house available for $200,000.Assuming a 20% down payment and a 30-year fixed rate mortgage at 6.65%,what will their PITI be? Annual property taxes are $2,400 and homeowner's insurance premium is $900 per year.

Accepted Answer

A) $1,027.14 
B) $1,283.93 
C) $1,302.14 
D) $1,558.93 
A) $1,027.14 
B) $1,283.93 
C) $1,302.14 
D) $1,558.93

Question 19

The initial rate on an adjustable rate mortgage (ARM)is sometimes called the teaser rate.

Accepted Answer

A) True 
 B)False

Question 20

Select the one cost that is not involved in home ownership.

Accepted Answer

A) Down payment 
B) Closing/settlement costs 
C) Rental deposit 
D) Points/discount points 
E) Loan origination fee 
A) Down payment 
B) Closing/settlement costs 
C) Rental deposit 
D) Points/discount points 
E) Loan origination fee

Sandra Smith wants to know the purpose of a title search.What would you tell her?

How much would the monthly payment be on a $400,000,5% APR,30 year mortgage?

The two most common types of two-step mortgages are the 8/22 and 12/18,in which lenders offer a lower interest rate for the first 8 or 12 years and then adjust the rate for the remaining 22 or 18 years.

The two primary advantages of a 15-year mortgage over a 30-year mortgage are

Which of these is not an advantage associated with an assumable loan?

Why is important to determine your housing needs not only for the present but also for the next several years?

When making a smart purchase you don't need to consider such charges as delivery fees,installation fees or service costs as these are already included in the purchase price.

For most cars,the manufacturer's warranty extends through the first seven years of ownership or the first 70,000 miles,whichever comes first.

An assumable loan is one that can be transferred to a new buyer who simply takes over the loan obligations.

Open-end leases are leases in which you return the vehicle at the end of the lease and you have no further responsibilities.

List the four steps in the automobile decision.

The typical down payment is 20% for traditional mortgage loans.

Your ARM has a two year adjustment interval,4% margin,2% periodic rate cap and a 6% lifetime cap.This year the market interest index increased by 2.75%.What will happen to your APR on this loan?

Rhonda is buying a second home to use as income property.She is financing 75% of the home's $100,000 value.Her bank is loaning her the money for 10 years at an APR of 4.5%.How much are Rhonda's mortgage payments?

Based on their incomes,how large of a PITI can they comfortably afford to pay?

Kathy is buying her first home.She is financing a total of $185,000 at an APR of 5% for 25 years.How much are her monthly payments?

Smart buying means buying what you want first and figuring out how you'll pay for it later.

They have found a very nice town house available for $200,000.Assuming a 20% down payment and a 30-year fixed rate mortgage at 6.65%,what will their PITI be? Annual property taxes are $2,400 and homeowner's insurance premium is $900 per year.

The initial rate on an adjustable rate mortgage (ARM)is sometimes called the teaser rate.

Select the one cost that is not involved in home ownership.

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

Sandra Smith wants to know the purpose of a title search.What would you tell her?

How much would the monthly payment be on a $400,000,5% APR,30 year mortgage?

The two most common types of two-step mortgages are the 8/22 and 12/18,in which lenders offer a lower interest rate for the first 8 or 12 years and then adjust the rate for the remaining 22 or 18 years.

The two primary advantages of a 15-year mortgage over a 30-year mortgage are

Which of these is not an advantage associated with an assumable loan?

Why is important to determine your housing needs not only for the present but also for the next several years?

When making a smart purchase you don't need to consider such charges as delivery fees,installation fees or service costs as these are already included in the purchase price.

For most cars,the manufacturer's warranty extends through the first seven years of ownership or the first 70,000 miles,whichever comes first.

An assumable loan is one that can be transferred to a new buyer who simply takes over the loan obligations.

Open-end leases are leases in which you return the vehicle at the end of the lease and you have no further responsibilities.

List the four steps in the automobile decision.

The typical down payment is 20% for traditional mortgage loans.

Your ARM has a two year adjustment interval,4% margin,2% periodic rate cap and a 6% lifetime cap.This year the market interest index increased by 2.75%.What will happen to your APR on this loan?

Rhonda is buying a second home to use as income property.She is financing 75% of the home's $100,000 value.Her bank is loaning her the money for 10 years at an APR of 4.5%.How much are Rhonda's mortgage payments?

Based on their incomes,how large of a PITI can they comfortably afford to pay?

Kathy is buying her first home.She is financing a total of $185,000 at an APR of 5% for 25 years.How much are her monthly payments?

Smart buying means buying what you want first and figuring out how you'll pay for it later.

They have found a very nice town house available for $200,000.Assuming a 20% down payment and a 30-year fixed rate mortgage at 6.65%,what will their PITI be? Annual property taxes are $2,400 and homeowner's insurance premium is $900 per year.

The initial rate on an adjustable rate mortgage (ARM)is sometimes called the teaser rate.

Select the one cost that is not involved in home ownership.

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