Quiz 9: Personal Finance

Duane Miller wants to know what price home he can afford. His annual gross income is $60,000. He has no other debt expenses and expects property taxes and insurance to cost $400 per month. He knows he can get a 6%, 15 year mortgage so his mortgage payment factor is 8.43. He expects to make a 10% down payment. What is Duane's affordable home purchase price? Round your answer to the nearest $100.

$164,800.

Michelle Duncan wants to know what price home she can afford. Her annual gross income is $45,000. She owes $750 per month on other debts and expects her property taxes and homeowners insurance to cost $250 per month. She knows she can get a 7.5%, 30 year mortgage so her mortgage payment factor is 6.99. She expects to make a 20% down payment. What is Michelle's affordable home purchase price? Round your answer to the nearest $100.

$76,000.

A cooperative housing arrangement involves:

A nonprofit organization whose residents must own its stock.

Gary Smith is purchasing one housing unit in a building with several units. What type of housing is Gary most likely going to live in?

Condominium.

A contract condition that states that the agreement is binding only if a certain event occurs is a:

Contingency clause.

Which of the following is a form of housing in which the units in a building are owned by a nonprofit organization?

Cooperative housing.

Most people do not select a place of residence based on:

Credit score.

Which of the following can affect the price of a home?

Current interest rates.

Which one of the following is an advantage of buying?

Financial benefits

Prefabricated homes refers to:

Housing units that are partially assembled in factories.

If you sell your home without a real estate agent, you should still employ the services of a ______ to assist you with the contract and the closing.

Lawyer.

A condominium involves:

Ownership of an individual housing unit in a building.

A home equity loan may also be referred to as a ______ mortgage.

Second.

Which of the following serves as collateral for the mortgage?

The home you buy.

A real estate short sale occurs when:

The new selling price is less than the amount owed on a previous mortgage.