WorksheetsHomeownership Quiz
Total questions: 25
Worksheet time: 21mins
What does appreciation represent in the context of homeownership?
The decrease in home values over time
The stability of home values
The cyclical nature of real estate prices
The increase in home values over time
What is home equity and how is it calculated?
The mortgage balance plus the value of the home
The mortgage balance minus the value of the home
The value of the home plus the mortgage balance
The value of the home minus the mortgage balance
What is a benefit of building equity in a home?
It increases the interest paid on the mortgage
It decreases the value of your home
It allows you to borrow more money for unnecessary expenses
It provides flexibility to get a loan tied to the amount of your home equity
What is the tax benefit of homeownership related to mortgage interest?
Mortgage interest is fully deductible from taxes
Mortgage interest is deductible only for high-income earners
Mortgage interest is not deductible from taxes
Mortgage interest is only partially deductible
What is the tax-free profit allowed by the IRS for single homeowners?
$250,000
$500,000
$100,000
$1,000,000
What is the tax-free profit allowed by the IRS for a couple that sells their home?
$250,000
$500,000
$100,000
$1,000,000
What is the primary reason for real estate appreciation?
The amenities in the neighborhood
The location of the home
The land on which the home sits
The structure of the home
What is the best long-term investment according to the text?
Stock market
Cryptocurrency
Residential real estate
Savings account
Buying a home achieves which two financial goals at the same time?
Providing a place to live, investing for the future
Providing a place to live, paying for your college expenses
Providing a place to live, bringing you great happiness
Providing a place to live, paying off your consumer debt
If you bought a home for $100,000 and the home is worth $150,000 and you paid down $20,000 of your mortgage- how much equity do you have in the home?
$150,000
$20,000
$70,000
$80,000
Which of the following Debt to Income ratios would be able to get mortgage approval? Check all that apply!
55
45
10
25
30
As your mortgage principal decreases, your home equity (a) .
If your home and property appreciates, your home equity (a)
Every time you make an on-time payment to your mortgage lender, your home equity (a)
If your home and property depreciates, your home equity (a)
TJ’s house and property are valued at $400,000. He currently owes $230,000 on his mortgage.
What is TJ's home equity?
$130,000
$200,000
$630,000
Parker’s house and property are valued at $850,000. He currently owes $800,000 on his mortgage.
What is Parker's home equity?
$850,000
$1.9 million
$100,000
Rana’s house and property are valued at $1,000,000. She currently owes $800,000 on her mortgage.
What is Rana’s home equity?
$1,800, 000
$20,000
$120,000
Brenda’s house and property are valued at $800,000. She currently owes $798,000 on her mortgage.
What is Brenda’s home equity?
$20,000
$1,598,000
$200,000
Ms.Herberger’s house and property are valued at $250,000. She currently owes $75,000 on her mortgage.
What is Ms. Herberger’s home equity?
$175,000
$70,000
$200,000
$120,000
Match the following
appreciation
an increase in value
depreciation
a decrease in value
equity
the amount owned in a mortgage/loan
principal
the amount borrowed
interest
the amount required to finance a loan
True or False: Home interest payments can be deducted from gross income when completing taxes.
True
False
True or False? Home equity loans are advantageous to other types of loans because of their lower interest rates.
True
False
What is a mortgage?
a loan used to purchase a home where the property serves as the borrower’s collateral
a loan used to purchase a vehicle where the vehicle serves as the borrower’s collateral
a loan used for personal use that does not require the borrower to make a down payment
a loan used to pay for home renovation that does not require the borrower to make a down payment
If you default on your mortgage, what is the most likely result?
The bank might sell your home to recover its investment
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
