Personal Finance-Chapter 7
A condominium is a type of building structure and not a legal form of ownership.
False
People who have very little money in savings will probably rent housing rather than purchase it.
True
Interior construction can include all of the following:
condition of plumbing fixtures ease and operation of windows
Common sources of down payment funds to purchase a home include:
personal savings assistance from relatives the sale of investments
Factors such as the material quality and condition of the building, the condition of the foundation, roof and gutters, and the type of chimney are part of the:
exterior construction
Single-family dwellings include which of the following?
Previously owned houses
A security deposit covers the cost of damages that may be done to a rental unit.
True
Negotiating the purchase price for a home may involve an offer and several counteroffers.
True
One of the reasons why renting offers fewer financial benefits than home ownership is that rent is not tax deductible while the interest on mortgage payments is.
True
Your ______, needs, desires, and attitudes are reflected in your choice of a home.
lifestyle
Fill in the blank question. The most important factor when buying a home is said to be the home's _____
location
The most important factor when buying a home is said to be the home's
location
It is a good idea for home buyers to go first to a mortgage company and _____.
pre-qualify
____ mortgage insurance is usually required if the down payment is less than 20 percent.
private
When thinking of buying your first home it is important to
realize you may not get everything you want in the first house consider a handy-man's special at a lower price
If a ______ is only slightly lower than the asking price, then you are expected to move closer to that price with your next offer.
counteroffer
Early in a person' s career, renting is advantageous because renting offers:
mobility.
While residents in cooperative housing do not own the units, they have the legal right to occupy their unit as long as they own ______ in the cooperative association.
stock
In the context of the home inspection as part of the home-buying process, identify elements of interior design.
Accessibility to basement and attic Adequate laundry area Ventilation for cooking
Location is considered the most important factor when buying a home.
True
In the context of the home inspection as part of the home-buying process, identify elements of exterior facilities.
Condition of patio or porch Appropriate drainage system
The financial variables to consider when determining an appropriate amount for your housing expenses include which of the following?
home cost take-home pay Income
a _____ deposit is usually one month's rent that is held by the landlord to cover the cost of any damages to the rented property.
security
The Homeowner Protection Act requires that a PMI policy be terminated when the equity reaches ______ of the property value at the time the mortgage was executed.
22 percent
When it comes to the size of manufactured homes, which one of the following is true?
Typically these homes are smaller than 1,000 square feet
Which of the following factors have an impact on the amount you can spend to acquire a home of your own?
Your current living expenses Your income (salary, wages, investment income, etc.) The amount of the down payment you can make
What are the advantages of owning a condominium?
Fewer maintenance responsibilities when compared to a house
Previously owned houses, new houses and custom-built houses are often referred to as:
single-family dwellings
Quality of landscaping, trees, and shrubs are part of the:
exterior facilities in a house.
Which of the following are the common terms (years) of home mortgages?
15 30 20 10
Educators recommend that schools be evaluated based on which of the following?
Student achievement level
The most common sources for a down payment include all of the following except:
checking account funds.
Restrictions regarding pets and _____ are often enforced on tenants by landlords.
decorating
Factors such as the appearance of the neighborhood, the quality of landscaping, the condition of the driveway, and the outdoor lighting are part of the:
exterior facilities
Potential home owners without children should evaluate school systems of the municipalities where they might live because:
good schools translate to rising property values
Tenants are protected from a rent _____ during the term of the lease unless the lease contains a provision allowing it.
increases
Generally speaking, the Blank______ the credit score the Blank______ the mortgage rate.
lower, higher higher, lower
When renting, it is not recommended that one should get insurance coverage on personal property.
False
Which of the following best describes the rights of residents of cooperative housing?
The right to occupy the unit for as long as stock is owned
Which of the following best describes the role of a home inspector?
To review the interior and exterior construction, facilities, and design of a potential home purchase
Homeowners can request that PMI be removed once equity has grown to 22 percent of the _____ of a home.
current market value.
A trained home _____ reviews the interior and exterior construction, facilities, and design of a potential home purchase.
inspector
Traditional guidelines suggest spending no more than ___ times your annual income on housing. Multiple choice question.
2 1/2
Payments on a mortgage are usually made over a time period ranging from 10 to _____ years.
30
Which of the following are the main services offered by a real estate agent?
Helping you negotiate a price for a home Recommending other advisers to help you with the process of buying or selling a home
What are some of the disadvantages of home ownership?
Higher living expenses than renting Significant financial commitment Limited mobility when compared to renting
What are some of the expenses (other than the rent payment) that you would incur if you were to rent a unit?
Internet Heat Electricity
Which of the following are disadvantages of buying housing?
Limited mobility (difficult to move) Significant financial commitment
Which of the following is not a service provided by a real estate agent?
Obtaining financing for you
The advantages of owning a manufactured home (mobile home) include which of the following?
Offer features such as fully equipped kitchen and fireplace Less expensive than other options
Which of the following are the important considerations when evaluating a local school system?
Percentage of students who go to college Program quality Achievement level of students
The tenant is protected from rental increases during the lease term unless the lease contains a(n) ______ allowing for increases.
Provision
Which of the following is not part of the interior construction that is evaluated during a home inspection?
Size and arrangement of rooms
Two external (market) factors that affect the price of a home are the current demand for housing and the financing options (i.e., interest rates) available.
True
Conventional 30-year mortgages provide certainty regarding principal and ___ payments.
interest
Factors such as the size and arrangement of rooms, layout of kitchen, and the location of bedrooms, closets, and storage space should be considered when inspecting the ______ of a home.
interior design
Renters have a financial disadvantage because they cannot take tax deductions for __________ interest.
mortgage
The amount of money offered for a home depends on (select all that apply)
recent selling prices of homes in the area. features of the home. the time the home has been on the market.
The advantages of owning a home include:
stability of residence tax benefits personalized living location
Every buying decision is a statement about your lifestyle.
True
Tenants are often subjected to restrictions regarding ______ and remodeling.
Pets
Which of the following statements is NOT true?
A point equals 5 percent of the loan amount.
Place the steps of the mortgage process in the sequence in which they occur.
c l m
Private mortgage insurance (PMI) is required when the down payment is less than ______ of the purchase price of the home.
20 percent
Homeowners without children do not need to be concerned with school system in which their home is located.
False
Current mortgage interest rates, your income, and funds available to make monthly payments can impact the amount you can spend on a home.
True
Which of the following are advantages of buying housing?
Significant tax benefits Many remodeling or customization possibilities
