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WorksheetsPFL #10a Renting/Buying a Home
Total questions: 30
Worksheet time: 55mins
Name
Class
Date
1.
One of the advantages of renting is that you
a)
can build equity.
b)
can remodel or make decorative changes as wanted.
c)
have less responsibility for maintenance and upkeep.
d)
have an opportunity to make friends with your neighbors.
2.
Condominiums are
a)
primarily designed for older people who no longer want a yard.
b)
built more like houses, but someone else is responsible for the maintenance.
c)
built like apartments, but have fewer units and fewer people living in the complex.
d)
owned by individuals and common parts of the property, such as the grounds and building structure, are owned jointly by the unit owners.
3.
When making decisions about a place to live, you should
a)
determine what you want and figure out a way to pay for it.
b)
determine how much you can spend and stay within your budget.
c)
not worry about the cost because it is most important that you feel safe and happy with where you live.
d)
base your final choice on cost because you can learn to be happy living anywhere you can afford to live.
4.
Amenities refer to
a)
the actual location of an apartment complex.
b)
extra features that cost more than most people can afford.
c)
additional features such as swimming pools, exercise rooms, etc.
d)
basic features such as the color of the walls, the type of carpeting, etc.
5.
“Everyone would own a house if they could afford to do so.” This statement is
a)
false because not everyone wants to own a house.
b)
true because owning a home is the American dream.
c)
true because living in a house has more advantages than living in an apartment.
d)
false because everyone can afford a house if they would only learn how to better budget their money.
6.
Renter’s insurance
a)
is available only to people who rent a house.
b)
is available only to people who rent an apartment.
c)
should be purchased by anyone who rents a place to live.
d)
is not necessary because the owners will pay for your personal property if anything happens.
7.
A lease specifies _____ when renting a place to live.
a)
what you can and cannot do.
b)
only the rights and responsibilities of the tenant.
c)
only the rights and responsibilities of the landlord.
d)
the rights and responsibilities of the tenant and landlord.
8.
A down payment is the
a)
part of the purchase price paid in cash up front.
b)
amount that a person must pay when renting an apartment.
c)
difference between how much a house is worth and how much is owed on it.
d)
loan to finance the purchase of real estate, usually with specified payment periods and interest rates.
9.
Which of the following should be included in a lease before you sign?
a)
The amount of the rent and how it must be paid.
b)
If you have roommate, only one person’s name and signature.
c)
The hours that the office is open and how to contact the manager.
d)
The address of the apartment complex, but not the exact apartment number.
10.
Amy is graduating from college and moving out of the dorm. Her best friend found a job in Dallas and plans to move soon. Amy is not sure whether to keep her job in Tulsa or move to Dallas with her friend. She needs a place to live until she decides. What do you recommend? Amy should
a)
buy a house because she can sell it when she leaves and make some money on it.
b)
sign a one year lease on an apartment because it will give her time to decide what she wants to do.
c)
rent an apartment, either on a month-to-month lease or with a lease that she can cancel if relocating out of state.
d)
Buy a house; she can always rent it out to someone else if she cannot sell it when she decides to move.
11.
Buying a house offers a tax advantage over renting because homeowners
a)
can deduct the interest they pay on a mortgage from their personal income taxes.
b)
can deduct their mortgage payment from their personal income taxes.
c)
do not have to pay personal income taxes if they have a mortgage.
d)
are charged an additional fee on their personal income taxes.
12.
Daren wants to buy a place but he does not like doing yard work. Daren should
a)
consider buying a condominium.
b)
buy a house and pay someone else to mow the yard.
c)
rent a house and ask the owner to mow the yard for him.
d)
find a nice apartment because he would have no yard work.
13.
The purpose for a security deposit is to
a)
pay for the last month of rent on you lease.
b)
pay for all maintenance while you live in the apartment.
c)
allow the owner/landlord to draw interest on your money while you live in the apartment.
d)
provide some protection for the landlord for damage you made to the apartment, cleaning fees, or other costs.
14.
Which of these costs are associated with buying a house?
a)
Down payments, points, and security deposits.
b)
Down payments, points, and homeowner association fees.
c)
Lease payments, security deposits, and loan application fees.
d)
Security payments, homeowner association fees, and title insurance.
15.
A month-to-month lease can be terminated
a)
only by the landlord.
b)
only by the tenant.
c)
only by the landlord or the tenant.
d)
only after all conditions of the lease have been met.
16.
Most landlords will ask you to inspect your apartment when you move in, and they give you a form to sign. What should you do?
a)
Just sign the form and return it to the landlord; it is just a formality and has little meaning.
b)
Examine the apartment for any needed repairs and call the landlord with your requests before signing the form.
c)
Make a note of the repairs and find someone to fix them, then subtract that amount from your next month’s rent.
d)
Complete the form you were given, making a note of any needed repairs, sign the form, make a copy for yourself, and return it to the landlord.
17.
Which of the following statements is TRUE?
a)
Renting an apartment is a greater financial commitment than owning a house.
b)
Owning a house is a greater financial commitment than renting an apartment.
c)
There is little financial difference between owning a house and renting an apartment.
d)
Owning a house is for wealthy people and renting an apartment is for low income people.
18.
Which of the following is a DISADVANTAGE to renting a place to live? Finding a(n)
a)
place that your roommate likes.
b)
complex near the bus stop.
c)
apartment with enough parking.
d)
apartment that will accept pets.
19.
Juan and Rebecca want to buy a house, but they have no idea what price range they can afford. What do you recommend to them?
a)
Get pre-qualified for a loan before starting their housing search.
b)
Read through the ads in the newspaper and see what sounds good.
c)
Get pre-approved for a mortgage before looking for a place to buy.
d)
Find a real estate agent who can tell them about the best neighborhoods.
20.
If you want to buy a house, MOST experts would recommend that finance it with a(n)
a)
adjustable rate mortgage.
b)
fixed rate mortgage.
c)
variable rate mortgage.
d)
any loan that you can qualify to receive.
21.
When negotiating an offer on a house, your top priority is making an offer that
a)
protects the real estate agent.
b)
you know the seller will accept without further negotiations.
c)
includes the contingencies and details you want considered.
d)
includes the contingencies and details the seller requests you to make.
22.
The deposit you pay when making an offer to show you are serious about buying the house is called
a)
frank money.
b)
down payment.
c)
security deposit.
d)
earnest money.
23.
If you had to give someone advice on buying a house, what would you recommend?
a)
Buy a house you can afford.
b)
Buy what you want, not what you need.
c)
Always buy the largest, most expensive house you can afford.
d)
When the bank pre-approves you for a mortgage amount, spend all of it on a house.
24.
“Buying a house is the most expensive purchase most people make.” Is this statement true or false?
a)
The statement is TRUE because buying a house is a major expenditure for most individuals and families.
b)
The statement is TRUE because most people spend at least 50 percent of their income on housing.
c)
The statement is FALSE because most people spend more on cars and clothing than on housing.
d)
The statement is FALSE because most people rent; only the wealthy can afford to buy a house.
25.
In addition to making a mortgage payment each month, homeowners are responsible to pay for all of the following EXCEPT
a)
utilities.
b)
property insurance.
c)
maintenance.
d)
security deposit.
26.
When buying a house, the buyer is required to pay closing costs which includes
a)
a down payment, real estate agent fee, property deposits, and maintenance fees.
b)
title insurance, attorney fees, survey costs, points, and inspection fees.
c)
a down payment, title insurance, inspection fees, and maintenance fees.
d)
security deposit, attorney fees, leasing fees, and property taxes.
27.
If the down payment on your house is less than 20% of the house price, you may be required to pay _____ each month with your mortgage payment.
a)
personal property insurance
b)
private property insurance
c)
private mortgage insurance
d)
real estate insurance
28.
To reduce your monthly house payment, you can
a)
make a larger down payment.
b)
make a smaller down payment.
c)
increase your interest rates.
d)
increase your emergency fund savings.
29.
Suppose your gross monthly income is $3,000. Using the Housing Expense Ratio, your maximum housing expense should be
a)
$1,080
b)
$840
c)
$500
d)
$115
30.
When renting a place to live, utilities are
a)
always included in the monthly rent.
b)
always paid by the tenant.
c)
paid either by the tenant or the landlord.
d)
not required when renting.
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