WorksheetsHome Buying Expenses
Total questions: 25
Worksheet time: 2hrs 5mins
The first step in the home-buying process according to the presentation is (a) .
What is the final step in the home-buying process ?
Determine home ownership needs
Price the property
Obtain financing
Close the purchase transaction
Why is it advised not to fixate on the listed sales price alone?
It might include hidden charges
It includes all necessary fees
It is always negotiable
It might cause one to overlook other fees and expenses
What should first-time home buyers prepare for in addition to the upfront expenses?
Future renovation costs
Neighbors' approval
Fees
Furniture costs
If you buy a $200,000 home and make a 10% down payment, how much money will you need to bring to closing?
$2,000
$20,000
$200,000
$10,000
What is the purpose of earnest money in a home buying process?
To cover the real estate agent's fees
To prove to the seller that the buyer is serious about purchasing
To pay for the home inspection
To fund the initial home insurance
What happens to the earnest money once the home purchase deal is finalized?
It is refunded to the buyer
It is given to the real estate agent
It is applied to the buyer's down payment or closing costs
It is forfeited to the seller
What could happen if there is no contingency in the purchase agreement for the earnest money?
The earnest money can be doubled
The buyer can automatically own the property
The buyer could lose the earnest money if the deal falls through
The seller must return the earnest money regardless of the deal outcome
What are closing costs primarily used to pay for when buying a home?
Furniture and moving expenses
Appraisal, title insurance, origination fee, lender fee, and inspections
Property taxes for the first year
Home decoration and renovation
When are closing costs typically due at the time of purchasing a home?
After one year of occupancy
At the time of the loan application
At the end of escrow, when you close on the loan.
When the mortgage is fully paid off
The reserve fund in a real estate transaction typically covers (a) .
What is the average cost of a local move?
$1,000
$1,700
$2,500
$3,000
What is the purpose of property taxes according to the text?
To fund private sector projects
To pay for community amenities and services such as public schools, roads, and fire departments
To increase the local government's savings
To cover the expenses of local entertainment events
What is an escrow account used for in the context of property taxes?
To collect and hold funds for future personal savings
To directly pay off personal debts
To hold funds for a future purpose, specifically to cover property taxes and home insurance until they are due
To invest in stocks and bonds
What does homeowners insurance typically cover in the context of natural damage?
Damage from interior water leaks
Damage from fallen trees or branches
Theft of personal property
Accidental damage from the homeowner
What are HOA fees used for?
Covering personal property taxes
Maintaining shared common areas in a community
Paying for individual home repairs
Funding homeowner's personal expenses
How much does an average single-family homeowner pay per month in HOA fees?
$50 – $150
$200 – $300
$400 – $500
$1000 – $1200
Approximately how much could the annual maintenance and repair costs be for a $200,000 home?
$500 - $1,500
$2,000 - $6,000
$8,000 - $12,000
$10,000 - $20,000
What is essential to be prepared for when buying a house according to the text?
Only the list price of the home
The color and design of the home
Upfront and ongoing expenses beyond the list price
The number of rooms in the house
What might be a consequence of not having enough savings when planning to buy a house?
Being able to buy a more expensive home
Considering a less expensive home to fit the budget
No impact on the choice of home
Decreasing the overall cost of the home
What is one of the main advantages of renting a property?
High financial benefits
Ease of mobility
Long-term investment
Ownership of property
Which of the following is a disadvantage of renting?
High initial costs
Opportunity to own a home
Restricted lifestyle
More responsibilities
What is NOT listed as a disadvantage of renting?
Fewer tax deductions
High maintenance costs
Legal concerns
No opportunity to have value of a home
How can buying a house affect mobility?
Increases mobility due to easy selling
Decreases mobility if the house is hard to sell
No impact on mobility
Improves physical fitness
Match the following descriptions with their correct definition related to home purchasing.
The total cost of the home
The amount covering the entire value of the property
A percentage of the home's purchase price paid upfront
The initial contribution by the buyer, usually a portion of the full purchase price
The monthly mortgage payment
Regular payment made towards the loan taken to buy the property
The closing costs of the transaction
Fees and expenses paid to finalize the mortgage
