untitled

What are the different types of home loans?

• interest-only mortgages

• fixed-rate mortgages, adjustable-rate mortgages, FHA loans, VA loans, and jumbo loans

• reverse mortgages

• conventional loans

What is the difference between fixed-rate and adjustable-rate mortgage interest rates?

• The difference is that a fixed-rate mortgage has a lower interest rate than an adjustable-rate mortgage.

• The difference is that a fixed-rate mortgage has a higher interest rate than an adjustable-rate mortgage.

• The difference is that a fixed-rate mortgage has a constant interest rate, while an adjustable-rate mortgage has a variable interest rate.

• The difference is that a fixed-rate mortgage has a shorter loan term than an adjustable-rate mortgage.

Tags

CCSS.7.RP.A.3

What is a down payment and how does it affect a home loan?

• A down payment is a payment made at the end of a home loan. It affects a home loan by increasing the amount borrowed and the loan-to-value ratio.

• A down payment is a payment made to the real estate agent. It affects a home loan by reducing the interest rate and monthly payments.

• A down payment is a payment made to the seller after purchasing a home. It affects a home loan by increasing the closing costs and the loan term.

• A down payment is a payment made upfront when purchasing a home. It affects a home loan by reducing the amount borrowed and determining the loan-to-value ratio.

Tags

CCSS.7.RP.A.3

Maria is applying for a mortgage. She makes about $4,800 per month and the bank estimates her total monthly housing payment (including insurance and taxes) will be around $2,500. What is her front-end ratio? Round to the nearest tenth of a percent.

• 52%

• 1.92%

• 5.20%

• .53%

Tags

CCSS.7.RP.A.3

Bill and Terry Noke are considering buying a house and need to figure out what they can afford and what a bank will lend them. Their adjusted gross income is $266,988. Their monthly mortgage payment for the house they want would be $2,544. Their annual property taxes would be $7,888, and the homeowner’s insurance premium would cost them $2,007 per year. They have a $520 per month car loan, and their average monthly credit card bill is $4,100. What is the back-end ratio?

• 76.67%

• 6.4%

• 24.5%

• 13.4%

Tags

CCSS.7.RP.A.3

Carl, who is 25 and living in Lexington until he retires is considered what type of mortgage loan?

• Fixed Rate Mortgage

• Adjustable- Rate Mortgage

Kristie, who needs lower payments for a few years until she finishes college is considered what type of mortgage loan?

• Fixed Rate Mortgage

• Adjustable-Rate Mortgage

Tanya, who’s worked out a budget that allows her to pay her mortgage and save for her three young children’s college funds.

• Fixed Rate Mortgage

• Adjustable- Rate Mortgage