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40 Cards in this Set
- Front
- Back
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Amoritzation |
The reduction of a loan balance through payments made over a period of time Based on an Amoritzation schedule, a home buyer will initially pay more in interest and less in principal. |
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Apartment |
a room or set of rooms within a larger building used as a residence through a rental agreement |
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Appraisal |
written estimate of the value of something |
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ARM |
Adjustable-rate mortgage, which does not have a fixed interest rate. The rate changes during the life of the loan based on an index rate |
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Buyer's Market |
a housing market that has more sellers than buyers and results in lower prices; also known as a soft market |
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Closing Costs |
costs paid to buy a house |
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Condominium |
a set of rooms used a residence and owned by individuals |
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Default |
failure to meet obligations of a loan agreement; failure to repay a financial obligation under terms agreed to; may result in legal action |
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discosure |
the revealing of information |
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down Payment |
cash amount paid up front to reduce the amount of the loan or mortgage |
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earnest money |
a deposit that shows a buyer is serious about buying |
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equity |
the difference in how much a house is worth and how much is owed on it |
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escrow |
a bank account that holds money in trust |
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index |
measurement of the value of real estate or other securities |
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lien |
a claim on property that settles a debt |
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mortgage |
long-term home loan |
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rent |
regular payment that allows the use of something, usually housing |
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What are some advantages to renting instead of buying |
Flexibility You don't worry about property values |
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What are some advantage to home ownership? |
Tax advantages You gain capital partly due to the increase in property values
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A disadvantage to renting is having to pay a? |
Security Deposit |
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A disadvantage to buying a home is paying a large? |
Down Payment |
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What type of mortgage offers people in unusual or special situations a lower interest rate and low down payment? |
A special Loan |
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You may need private mortgage insurance if you have a down payment less than? |
20% |
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If you don't qualify for a VA or FHA loan, but don't want to take any risk with a home loan, What type of mortgage would be best? |
Fixed Rate Mortgage
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If someone is having trouble paying their living expenses but want to stay in their home what type of mortgage might help them? |
Adjustable Rate Mortgage |
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What is the most common type of housing? |
Single Family Dwelling |
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Which type of housing units have two or three homes together and is usually a two-story structure? |
Townhouses |
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When you agree to buy a home, what you pay to the seller to let them know you're serious? |
Earnest Money |
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What are some costs that can be expected at closing? |
Title Insurance Filing or recording fee |
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What is a cost that would be in an escrow account? |
Insurance
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The housing Expense ratio states that borrowers can afford up to what percent on housing payments, including their property taxes and homeowners insurance? |
28% |
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What type of house can provide you with a place to live on one side and a rental income on the other side? |
Duplex |
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According to the debt ratio formula, debt payments, including housing payments should not exceed what percent of your income? |
36% |
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What is a reverse mortgage? |
A mortgage used most often by retired people who have a lot of equity in their home. |
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Which type of mortgage is based on a 30 year amortization but require the balance of the mortgage at the end of a much shorter term |
Balloon Mortgage |
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Mortgages that are insured or guaranteed by a federal government agency, and a lender can offer lower rates; usually due to a unique or special circumstance |
Special Loans |
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Which type of mortgage has a fixed interest rate for the life of the loan? |
Fixed rate mortgages
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Which types of mortgages have an adjustable or variable interest rate? |
Adjustable rate mortgages |
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Is no equity an advantage or disadvantage of renting? |
Disadvantage
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Will monthly mortgage payments be higher or lower for a 30 year mortgage compared to a 15 year mortgage? |
No-payments are higher on a 15 year mortgage, but you gain equity faster. |
