Chapter 09 – The Housing Decision: Factors and Finances
54. (p. 306) Which of the following is an example of a closing cost?
55. (p. 306) The purpose of title insurance is to:
56. (p. 306) Which document is used to transfer ownership of property from one party to
Chapter 09 – The Housing Decision: Factors and Finances
57. (p. 307) Which of the following expenses is paid from an escrow account?
58. (p. 309) The purpose of an appraisal is to:
59. (p. 309) If you sell your home without a real estate agent, you should still employ the
services of a(n):
Chapter 09 – The Housing Decision: Factors and Finances
60. (p. 310) The most common service provided by a real estate agent when selling your home
is:
61. (p. 288) Which one of the following is an advantage of renting?
62. (p. 291) Which one of the following is an advantage of buying?
Chapter 09 – The Housing Decision: Factors and Finances
63. (p. 289) A cost associated with renting would be:
64. (p. 293) A is a building that contains exactly two separate homes.
65. (p. 293) Gary Smith is purchasing one living unit in a building. What type of housing is Gary
most likely going to live in?
Chapter 09 – The Housing Decision: Factors and Finances
66. (p. 293) James Monroe is a member of a nonprofit organization that allows him to rent a
living unit in a building. What type of housing is James most likely living in?
67. (p. 294) Jennifer Garland is purchasing a home that was assembled in a factory and then
moved to the living site. What type of housing is Jennifer purchasing?
68. (p. 292) What is the most popular type of home ownership?
Chapter 09 – The Housing Decision: Factors and Finances
69. (p. 293) The assessed value of your home is the:
70. (p. 301) The appraised value of your home is the:
Chapter 09 – The Housing Decision: Factors and Finances
71. (p. 299) Michelle Duncan wants to know what price home she can afford. Her annual gross
income is $45,000. She owes $750 per month on other debts and expects her property taxes
and homeowners insurance to cost $250 per month. She knows she can get a 7.5%, 30year
mortgage so her mortgage payment factor is 6.99. She expects to make a 20% down payment.
What is Michelle’s affordable home purchase price? Round your answer to the nearest
$100.
Chapter 09 – The Housing Decision: Factors and Finances
72. (p. 299) Duane Miller wants to know what price home he can afford. His annual gross
income is $60,000. He has no other debt expenses and expects property taxes and insurance to
cost $400 per month. He knows he can get a 6%, 15year mortgage so his mortgage payment
factor is 8.43. He expects to make a 10% down payment. What is Duane’s affordable home
purchase price? Round your answer to the nearest $100.
73. (p. 305) A loan based on the equity of the home that provides the homeowner with tax-free
income and which is paid back when the home is sold is called a(an):
Chapter 09 – The Housing Decision: Factors and Finances
74. (p. 289) A renter is required to pay a security deposit of $800, on which 4 percent interest
will be paid. What amount would the person earn each year?
75. (p. 305) If closing costs of $1,400 are associated with the refinance of a mortgage that would
reduce the monthly payment from $980 to $870, it would take approximately ____ months to
cover these costs.
Chapter 09 – The Housing Decision: Factors and Finances
76. (p. 291) Ted pays $4,500 in real estate property taxes and is in the 28 percent tax bracket.
What is the value of this federal tax deduction?
77. (p. 295) Some real estate experts estimate that remodeling a kitchen can add 130 percent of
the cost of remodeling to the value of the house. A remodeled kitchen costing $8,000 could
add _____ to the value of the house.
Chapter 09 – The Housing Decision: Factors and Finances
78. (p. 298) A contract condition that states that the agreement is binding only if a certain event
occurs is a(n):
79. (p. 301) Paula has completed a mortgage application and provided evidence of employment,
income, and existing debt to the potential lending institution. Although Paula has not even
begun the process of looking at possible homes to buy, she is eagerly awaiting news from the
lender as to whether she has been approved for a mortgage. In what stage of the application
process is she?
Chapter 09 – The Housing Decision: Factors and Finances
80. (p. 295) Noelle and Larry have decided to perform the landscaping of their new home by
themselves. They also plan to take a do-it-yourself class at a local home store so they can
replace the tile in the master bathroom without using a contractor. The effect of performing
these tasks themselves will result in an increase in their:
81. (p. 294) Which type of home is most apt to depreciate in value?
82. (p. 296) Brett has hired a professional to assess the soundness of the roof, foundation, and
building materials of a potential home he is considering. The professional will also be
checking other aspects of the home including the plumbing, heating, and cooling systems.
Brett is paying for a(an):
Chapter 09 – The Housing Decision: Factors and Finances
83. (p. 307) Legislation that requires that loan applicants be given certain information, including
an estimate of closing costs, before the closing is known as:
84. (p. 283) What factors influence the type of housing a family will select?
85. (p. 292) Gerry Intel is considering buying a home. What actions would you recommend for
her to take to accomplish this goal of buying a home?
Chapter 09 – The Housing Decision: Factors and Finances
86. (p. 309) John Ashford needs to sell his home because of a job transfer to another city. What
actions should John take to sell his home?
87. (p. 297) Explain how current interest rates can affect the price of a home.
Chapter 09 – The Housing Decision: Factors and Finances
88. (p. 301) Explain what amortization is and how a down payment and loan duration impact it.
89. (p. 304) Explain negative amortization and how such a situation can occur.
90. (p. 307) What is the purpose of an escrow account and what costs are typically included?
Chapter 09 – The Housing Decision: Factors and Finances
91. (p. 293) Differentiate between a cooperative and a condominium. Be sure to include a
discussion of the ownership and responsibility for the common areas.