Mr Brain's Investing & P.F. - ch 22

Service (MLS)

A real estate marketing service in which agents pool home listings and share commissions

mortgage

a loan for real estate

appraised value

the homes value determined by examining the structure, size, features, and quality compared to similiar homes.

assessed value

value of a property set by the city or county that is used to compute property taxes

down payment

Amount of money used as a deposit for a loan

conventional loan

a mortgage loan not "backed" by a government organization

FHA loan

government sponsored loan that carries mortgage insurance. - may only need as little as 3% down

counter offer

An offer in response to another offer

home equity

The difference between the market value of property and the amount owed on it

acceptance

A formal agreement to the terms of an offer

lien

A financial claim on property

deed

A legal document that establishes ownership

fixed rate mortgage

A mortgage for which the interest rate does not change during the term of the loan

adjustable rate mortgage

A mortgage for which the interest rate changes in response to the movement of interest rates in the economy

market value

The highest price that property will bring on the market

title

Legally establishing ownership

closing cost

expenses incurred transferring the property

loan origination fee

charged by bank or lender to prepare the paperwork

discount points

a one time fee used to "buy a lower interest rate"

A

A legal document that establishes ownership is a(n) (a) deed, (b) title, (c) lien, (d) acceptance

A

A formal document that expresses interest in entering into a contract with someone is a(n) (a) offer, (b) acceptance, (c) counteroffer, (d) lien.

C

The difference between the market value of property and the amount owed on it is called (a) closing cost, (b) acceptance, (c) equity, (d) adjustable rate..........................

D

Home ownership offers (a) privacy, (b) freedom, (c) independence, (d) all of these.

C

. All of the following are ways to reduce the total amount of interest you pay on your mortgage over the life of the loan. (a) reduce from a 30 to 15 yr mortgage, (b) go to a bi-monthly payment, (c) find a higher interest rate, (d) add a little extra each month

B

Most conventional loans require a down payment of (a) 5-10 percent, (b) 10-30 percent,

(c) 25-30 percent, (d) 30-40 percent.

D

The portion of the purchase price that the buyer deposits as evidence of good faith is called (a) offer, (b) acceptance, (c) escrow, (d) earnest money

B

With an adjustable-rate mortgage, the interest rate changes in response to the movement of __________________ as a whole. (a) the political situation, (b) the economy,(c) property values, (d) property availability

D

Methods of locating possible houses to buy include (a) working with a real estate agent, (b) looking online, (c) looking at houses yourself, (d) all of these

D

Because the seller pays the real estate commission, the agents representing both the buyer and the seller really work for (a) themselves, (b) the buyer, (c) the seller, (d) the buyer and the seller

B

A major source of funding for local governments is (a) utilities, (b) property taxes, (c) mortgages, (d) closing costs.

T

Earnest money is held in an account until the real estate purchase transaction is closed

T

Both real estate agents and professional appraisers can estimate the value of homes

T

Closing costs are also called settlement costs and are paid when a real estate transaction is completed.

F

A fixed-rate mortgage usually increases by one or two percentage points a year.

T

A borrower's credit history is an important part of qualifying for a mortgage loan...

F

Generally it is better to buy or sell a house yourself, without the services of a real estate agent. .

F

The closing is the time when you make your final offer to the seller..

T

To ensure a clear title, you should order a title search.

F

The two basic types of mortgages are floating-rate and adjustable rate.

F

It is very easy to qualify for a mortgage.

T

The seller may or may not accept your initial offer

T

In some locations, the complete MLS is available online.

F

A real estate agent's commission is usually around 10 percent

T

Homeowners pay property taxes based on the assessed value of land and buildings.

F

After the down payment, most home buyers borrow the rest of the purchase price from family members. ...