True/False
Indicate whether the sentence or statement is true
or false.
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1.
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The market
value of homes tends to decrease or depreciate over time.
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2.
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After the
down payment, most home buyers borrow the rest of the purchase price from family.
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3.
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Homeowners
pay property taxes based on the assessed value of land and buildings.
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4.
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The seller
may or may not accept your initial offer.
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5.
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It is
usually very easy to qualify for a mortgage.
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6.
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The closing
is the time when you make your final offer to the seller.
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7.
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Generally it
is better to buy or sell a house yourself, without the services of a real estate agent.
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8.
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Earnest
money is held in an account until the real estate purchase transaction is closed.
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9.
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When the
seller agrees to your offer exactly as stated, you have an acceptance.
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10.
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The most
common source of down payment money is borrowing from parents or relatives.
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11.
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A borrower's
credit history is an important part of qualifying for a mortgage loan.
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12.
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A fixed-rate
mortgage usually increases by one or two percentage points a year.
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13.
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Closing
costs are also called settlement costs and are paid when a real estate transaction is
completed.
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14.
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Home
ownership offers financial advantages, but there are significant expenses as well.
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15.
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The interest
you pay on your home loan, along with the property taxes, are NOT tax
deductible.
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Multiple Choice
Identify the
letter of the choice that best completes the statement or answers the question.
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16.
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With an
adjustable-rate mortgage, the interest rate changes in response to the movement of ____ as a
whole. a. | The political
situation | c. | Property
values | b. | The economy | d. | Property availability | | | | |
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17.
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The
difference between the market value of property and the amount owed on it is called
____. a. | Closing
cost | c. | Equity | b. | Acceptance | d. | Adjustable rate | | | | |
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18.
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Which of the
following is a finance charge equal to one percent of the loan amount? a. | Lien | c. | Mortgage | b. | Closing cost | d. | Point | | | | |
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19.
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A major
source of funding for local governments is ____. a. | Liens | c. | Mortgages | b. | Property taxes | d. | Closing costs | | | | |
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20.
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Because the
seller pays the real estate commission, the agents representing both the buyer and the seller really
work for ____. a. | Themselves | c. | The
seller | b. | The buyer | d. | The buyer and the seller | | | | |
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21.
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Methods of
locating possible houses to buy include which of the following? a. | Working with a real
estate agent | c. | Looking at houses
yourself | b. | Looking online | d. | All of these | | | | |
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22.
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The portion
of the purchase price that the buyer deposits as evidence of good faith is called
____. a. | Offer | c. | Escrow | b. | Acceptance | d. | Earnest money | | | | |
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23.
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A formal
document that expresses interest in entering into a contract with someone is a(n)
____. a. | Offer | c. | Counteroffer | b. | Acceptance | d. | Lien | | | | |
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24.
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A legal
document that establishes ownership is a(n) ____. a. | Deed | c. | Lien | b. | Title | d. | Acceptance | | | | |
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25.
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Most
conventional loans require a down payment of ____. a. | 5-10% | c. | 25-30% | b. | 10-30% | d. | 30-40% | | | | |
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Matching
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For each
description listed below, find the corresponding term. a. | Acceptance | h. | Title | b. | Lien | i. | Equity | c. | Multiple Listing Service (MLS) | j. | Deed | d. | Counteroffer | k. | Points | e. | Fixed-rate
mortgage | l. | Offer | f. | Closing costs | m. | Earnest money | g. | Adjustable-rate
mortgage | | | | |
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26.
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Settlement
costs.
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27.
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A real
estate marketing service in which agents pool home listings and share commissions.
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28.
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An offer in
response to another offer.
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29.
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The
difference between the market value of property and the amount owed on it.
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30.
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A formal
agreement to the terms of an offer.
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31.
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A financial
claim on property.
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32.
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A legal
document that establishes ownership.
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33.
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A mortgage
for which the interest rate does not change during the term of the loan.
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34.
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A mortgage
for which the interest rate changes in response to the movement of interest rates in the
economy.
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35.
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A legal
document that transfers title of real property from one party to another.
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Short Answer
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36.
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Explain, in detail, exactly how you would go about selling your home.
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37.
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Compare and list the advantages and disadvantages of owner your own
home.
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38.
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Compare and list the advantages and disadvantages of renting a home or
apartment.
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