Personal Finance Courses: Housing

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1.
_______ are fees you pay to the lender in exchange for a reduced interest rate on a home.
Choose wisely. There is only one correct answer.
Points. Points are fees you pay to the lender in exchange for a reduced interest rate. A point is 1% of the mortgage amount.
2.
The current market value of your home, minus what you owe on it, is commonly known as your _________.
Choose wisely. There is only one correct answer.
Home equity. Your home equity is the difference between what you own (the current market value of your property) and what you owe on the property.
3.
You must pay private mortgage insurance if your down payment on a home is less than _______.
Choose wisely. There is only one correct answer.
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.
4.
An advantage of _______ is that you can build equity.
Choose wisely. There is only one correct answer.
Owning a home. When you own a home, the money that you paid on it will be your equity.
5.
Why does having a cosigner on an apartment lease make a landlord more willing to rent to you than if you didn't?
Choose wisely. There is only one correct answer.
The cosigner is liable for the rent if you default on it. The cosigner is like an insurance policy on the rent.