Question 1

A balloon payment mortgage makes the best sense for borrowers who are

Accepted Answer

planning on selling their homes before the term of the loan ends.

Question 2

Which accurately describes the terms of this mortgage? Check all that apply.

Accepted Answer

Monthly payments must be made for 30 years.The annual interest rate is 4.8 percent.The homeowner is borrowing $200,000.

Question 3

In a mortgage, the amount of money borrowed is called the

Accepted Answer

principle

Question 4

If someone buys a home for $200,000 and makes a 20 percent down payment, that person will have to

Accepted Answer

pay $40,000 up front.

Question 5

Many people prefer a fixed-rate mortgage because it

Accepted Answer

is predictable

Question 6

What best explains the relationship between a borrower's credit score and a down payment requirement?

Accepted Answer

Someone with a high credit score may be required to make a lower down payment.

Question 7

When people take out a mortgage, they must pay back the money

Accepted Answer

over time, usually many years.

Question 8

According to the terms of the sample balloon payment mortgage, what will most likely occur at the end of the regular payment term?

Accepted Answer

the remaining principal of $173,073 will be due immediately

Question 9

Homeowners typically pay property taxes to

Accepted Answer

help finance state and local governments.

Question 10

What is the best conclusion that can be drawn from the information in the chart?

Accepted Answer

There are additional fees and costs involved in taking out a mortgage.

Mortgages And Home Ownership

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