Personal Finance Courses: Housing

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1.
What kind of loan uses the equity in your home as collateral so that you can borrow money?
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Home equity loan. Your home equity is the difference between what you own (the current market value of your property) and what you still owe on the property. You can take out a loan against this amount, called a home equity loan.
2.
Whom does title insurance protect?
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You and your lender. Title insurance protects you and your lender in case you discover afterward that someone else could lay claim to the house.
3.
Why does having a cosigner on an apartment lease make a landlord more willing to rent to you than if you didn't?
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The cosigner is liable for the rent if you default on it. The cosigner is like an insurance policy on the rent.
4.
Renting a home is _______ cheaper than owning a home.
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Often. Often, renting is cheaper. But sometimes, it is more expensive. It depends on a lot of factors.
5.
You must pay private mortgage insurance if your down payment on a home is less than _______.
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20%. If your down payment is less than 20% of the price of the home, you will have to pay for mortgage insurance. This insurance protects the lender (but not you) in case you fail to keep making payments on the home.