W!SE Consumer Skills: Housing

An advantage of renting a home is...

• Housing security

• Freedom to do as you please

• Not as many utitlies

• No maintenance costs

Answer explanation

When you rent, you can move more easily, but you have less security. You can be evicted by your landlord.

You also have less freedom to do what you want, as landlords have rules regarding pets, painting, etc.

You can have just as many utilities as owning, but you are not responsible for maintenance.

A rental lease...

• Is implied by law

• Defines the conditions of the rental agreement

• Have to grant sublet rights

Answer explanation

Rental Lease:

A legal document that defines the conditions of a rental agreement.

It gives the address, names of parties, dates for lease, security deposit details, what is included (utilities/furniture), pets, conditions, and damages.

May or may not give sublet rights.

Multi-Unit Housing includes...

• 
• 
• 
• 

Answer explanation

Multi-unit housing is housing that shares at least one common wall with another housing unit.

A ____________ owns an apartment building and a ___________ rents from them.

• Homeowner/

  Tenant

• Landlord/

  Renter

• Landlord/Tenant

• Homeowner/

  Renter

A security deposit includes all

of the following EXCEPT:

• It is commonly equal to one month's rent

• It acts as security against unpaid rent or damages to the rental

• Landlords can deduct normal "wear and tear" from secutity deposits

• A landlord has up to 90 days to return a security deposit

When taking a loan, the principal is...

• The main contact you have with the loan company

• The total amount you expect to pay over the life

  of the laon

• The original amount of money borrowed.

Answer explanation

The loan principal is the original amount borrowed. It does not include interest. As you begin to pay installments on a mortgage, the majority of the payments will go towards interest. Towards the end of the loan, the majority of payments go towards principal. Any monthly payments you make over your mortgage amount will go directly to pay down principal.

If you use ownership financing, the buyer pays the seller directly.

• True

• False

Answer explanation

Ownership Financing:

A transaction in which a property seller financed the purchase directly with the person or entity buying it, either in whole or in part.

For example, when I sold my property in West Virginia, the buyer paid me directly with a fixed payment amount over set period until he had paid me for the purchase price.

You offer to buy a property, if the owner accepts,

at closing you should own all of the following EXCEPT:

• The well-house located on the property

• Lumber loacted on the property

• The tractor

  in the field

• The home located on the property

Answer explanation

Real property includes the land, along with any permanent improvements attached to the land, whether natural or man-made.

Includes water, minerals, buildings, and fences.

Vehicles are not attached the the land, so they would not be included in the sale unless specifically added.

If you have a variable mortgage,

your interest rate will not change.

• True

• False

Answer explanation

Fixed Mortgage: Refers to a fixed rate mortgage, a home loan that has a fixed rate of interest for the entire term of the loan-the rate will not change.

Variable Mortgages: A type of loan in which the interest rate is not fixed. Instead, the interest rate will be adjusted at a level above a specified benchmark or reference rate.

When buying a home, __________ is paid by the buyer a few days after

an accepted offer to show they are serious about the purchase.

• Down

  Payment

• Earnest

  Money

• Cosing costs

• Appriasal Fee

Answer explanation

Earnest Money:

A portion of the price of a home that the buyer deposits as evidence of good faith to indicate a serious purchase offer.

It is paid within a few days of an accepted offer and is typically around 1 – 3% of the sale price and is held in an escrow account until the deal is complete.