Personal finance

A lease typically protects the landlord but not the renter.

false

The escrow account is used to accumulate funds for

both homeowner's insurance premiums and real estate property taxes.

An original tenant who subleases to another tenant is automatically released from financial responsibility for future rent payments.

false

Mortgage lenders generally prefer that total monthly debt does not exceed a 2:1 ratio of gross monthly income.

false

The security deposit is an amount paid in advance to a landlord for normal wear and tear on rental property.

false

When estimating monthly housing costs after the purchase of a home, add an additional 10 to 15 percent to your mortgage loan payment for such things as homeowner's insurance, property taxes, maintenance, and upkeep.

false

The process in which the lender sues the borrower to prove default and asks the court to order the sale of real estate property to pay the mortgage debt is called

foreclosure

The dollar value of the home in excess of the outstanding mortgage debt is called

homeowner's equity

____ is when the home is financially and legally transferred to the new owner.

closing

Carl has found an apartment that has monthly rent payment of $950 and requires a one month's security deposit and a $500 damage deposit. In order to move in, Carl will probably be required to pay

$1450

Jillian wants to rent an apartment that has monthly rent payments of $850 and requires a $400 security deposit and a $500 damage deposit. In order to move in, Jillian will probably be required to pay

$1750

Martha and Gordon purchased a home for $175,000 six years ago with a 5.5 percent, 30-year $140,000 mortgage. Their home now has a market value of $220,000 and they owe $124,000 on the mortgage. What is the equity in their home?

$96,000

When preparing a budget to buy a new home, you should add an additional ____ percent to the monthly payment on the loan for such things as homeowner's insurance, property taxes, maintenance, and upkeep.

40

The typical required loan-to-value ratio today is no more than

80 percent

A renter may have to pay ____ when moving into an apartment.

All of these

Which real estate agent works solely for the home buyer?

Buyer's agent

________ clauses specify that certain conditions must be satisfied before a home purchase contract is binding

Contingency

Which of the following characteristics would cause a person to prefer renting over buying housing?

Unknown job stability in the geographical area

A loan to purchase real estate in which the real estate itself serves as collateral is a ____ loan.

mortgage

____ mortgage insurance is generally required for any mortgage loan where the down payment is less than 20 percent

private

Making a larger than required down payment on a given home will

reduce the amount of the monthly payments.

When a tenant who wants to move before his or her lease is up and leases to another tenant, this is called

subleasing

Lenders in the sub-prime market offer loans

to higher-risk applicants

A loan origination fee, recording fee, and an appraisal fee are examples of miscellaneous expenses involved in buying a home

true

A title to real property is the legal right of ownership interest.

true

Buying a home represents the largest expenditure most people ever make

true

Subleasing means leasing the property from the original tenant to another tenant before the lease expires.

true

You should always obtain a prequalification from a lender before your search for a home to buy.

true