Mortgages

For most installment purchases (like a mortgage), a ______________ is generally required. It is usually a certain percentage of the purchase price.

• Down payment

• Monthly payment

• Start up payment

• Initial payment

If you are unable to repay your mortgage, what is the most likely result?

• The bank might sell your home to recover its investment (foreclosure).

• You might have to go to prison

• The bank might force you to take out an additional loan

• The bank might take all they money and goods you own

What is a mortgage?

• A loan to purchase real estate

• A type of insurance

• A savings account

• A credit card

Which of the following is typically required to secure a mortgage?

• Collateral

• A co-signer

• A high school diploma

• A business plan

What is the term for the interest rate on a mortgage that does not change over time?

• Fixed-rate

• Variable-rate

• Adjustable-rate

• Floating-rate

What is the primary purpose of a mortgage?

• To finance the purchase of a home

• To pay for college tuition

• To buy a car

• To start a business

Which government agency is known for insuring mortgages?

• Federal Housing Administration (FHA)

• Federal Bureau of Investigation (FBI)

• Central Intelligence Agency (CIA)

• Environmental Protection Agency (EPA)

What is the term for the process of a bank taking possession of a property due to mortgage default?

• Foreclosure

• Eviction

• Repossession

• Liquidation

What is an adjustable-rate mortgage (ARM)?

• A mortgage with an interest rate that can change over time

• A mortgage with a fixed interest rate

• A mortgage that requires no down payment

• A mortgage that is only available to veterans

What is the typical length of a mortgage term in the United States?

• 30 years

• 10 years

• 5 years

• 50 years