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| 1 | |
The amount of down payment one makes on a home directly affects the size of the monthly payment. |
| | A) | True |
| | B) | False |
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| 2 | |
Graduated payments let the borrower pay more at beginning of mortgage and lower payment later. |
| | A) | True |
| | B) | False |
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| 3 | |
The reduction of principal each month is equal to the payment less the interest. |
| | A) | True |
| | B) | False |
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| 4 | |
A mortgage of $80,000 with 2 points mean the borrower would have to pay at closing $800. |
| | A) | True |
| | B) | False |
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| 5 | |
From the table in the handbook, the monthly payment on a home purchased for $120,000 with 20 percent down at 8% for 25 years is $741.12. |
| | A) | True |
| | B) | False |
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| 6 | |
A monthly payment of $850 on a 30 year $80,000 mortgage results in a total cost of interest of $226,000. |
| | A) | True |
| | B) | False |
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| 7 | |
Graduated payments result in the borrower paying: |
| | A) | More at beginning of mortgage |
| | B) | Less at beginning of mortgage |
| | C) | Less at end of mortgage |
| | D) | The mortgage at ½ the standard rate |
| | E) | None of the above |
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| 8 | |
Al Small is charged 3 points on a $60,000 loan at time of closing. The original price of the home before the down payment was $100,000. The points in dollars cost Al: |
| | A) | $3,000 |
| | B) | $1,080 |
| | C) | $600 |
| | D) | $1,800 |
| | E) | None of the above |
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| 9 | |
Jane Smate bought a home for $180,000. She put down 20 percent. The mortgage is at 7% for 25 years. By using the table in the handbook, her monthly payment is: |
| | A) | $950.40 |
| | B) | $1,578.24 |
| | C) | $1,018.08 |
| | D) | None of the above |
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| 10 | |
The total cost of interest is equal to the total of all monthly payments: |
| | A) | Divided by amount of mortgage |
| | B) | Less amount of mortgage |
| | C) | Plus amount of mortgage |
| | D) | Times amount of mortgage |
| | E) | None of the above |
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| 11 | |
An amortization schedule shows: |
| | A) | Balance of interest outstanding |
| | B) | The increase to principal |
| | C) | Increase in loan outstanding |
| | D) | Portion of payment broken down to interest and principal |
| | E) | None of the above |
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| 12 | |
Abe Aster bought a new split level for $200,000. Abe put down 30 percent. Assuming a rate of 11½ percent on a 30 year mortgage, Abe's monthly payment is: (Use the table in the handbook) |
| | A) | $1,423.80 |
| | B) | $1,387.40 |
| | C) | $1,367.80 |
| | D) | $1,982.00 |
| | E) | None of the above |
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| 13 | |
Jill Diamong bought a home for $190,000 with a down payment of $65,000. The rate of interest was 7% for 35 years. Her monthly payment is: |
| | A) | $843.75 |
| | B) | $834.57 |
| | C) | $798.75 |
| | D) | $978.57 |
| | E) | None of the above |
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| 14 | |
Marsha Terban bought a home for $119,000 with a down payment of $19,000. Her rate of interest is 12½ percent for 35 years. The balance of mortgage at end of the 1st month is: |
| | A) | $3.33 |
| | B) | $98,944 |
| | C) | $99,669.76 |
| | D) | $99,985.67 |
| | E) | None of the above |
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| 15 | |
A $104,000 selling price with $24,000 down at 8½% for 25 years results in a monthly payment of: |
| | A) | $644.80 |
| | B) | $645.60 |
| | C) | $546.06 |
| | D) | $654.60 |
| | E) | None of the above |
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