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Chapter 15 Quiz 3
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Terms in this set (20)
Jake Bass bought a home for $170,000 putting down $40,000. The rate of interest is 14 percent for 25 years. The total yearly mortgage payment is:
$18,782.40
Joe Francis purchased a new condominium for $205,000. The bank required a $40,000 down. Assuming a rate of 8 1/2 percent on a 25 year mortgage, Joe's monthly payment is approximately: (Use the table in the handbook or Excel)
$1,329.90
All mortgage payments must be paid:
None of the above
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:
$1,800
The amount of down payment one makes on a home directly affects the size of the monthly payment.
True
John Smith has a $120,000 7 percent mortgage. His monthly payment is $848.40. His first payment will reduce the principal to an outstanding balance of:
$119,851.60
Bill's monthly payment is $1,056 per month. The principal is $100,000 at a rate of 12 1/2 percent for 35 years. The amount of interest for Bill's 1st payment is $1,011.67.
False
Interest rates on mortgages do not vary from bank to bank.
False
Graduated payments result in the borrower paying:
Less at beginning of mortgage
An amortization schedule shows:
Portion of payment broken down to interest and principal
A variable rate mortgage means:
The interest rate is not fixed
A monthly payment of $850 on a 30 year $80,000 mortgage results in a total cost of interest of $226,000.
True
A point is 1 percent of the amount of the loan.
True
Tom Burke bought a home in Virginia for $139,000. He puts down 30 percent and obtains a mortgage for 25 years at 12 percent. The portion of the 1st payment that covers interest is:
$ 973.00
The total of all monthly payments plus the amount of the mortgage equals the total cost of interest.
False
Jill Diamond bought a home for $190,000 with a down payment of $65,000. The rate of interest was 7 percent for 35 years. Her monthly mortgage payment is approximately:
$798.75
The reduction of principal each month is equal to the payment less the interest.
True
Marsha Terban bought a home for $119,000 with a down payment of $19,000. Her rate of interest is 12 1/2 percent for 35 years. The balance of mortgage at end of 1st month is approximately:
$99,985.67
Abe Aster bought a new spit level for $200,000. Abe put down 30 percent. Assuming a rate of 11 1/2 percent on a 30 year mortgage Abe's monthly payment is approximately: (Use the table in the handbook or Excel)
$1,387.40
Bill Moore took out an $80,000 mortgage on a ski chalet. The bank charged 4 points at closing. The points in dollars cost Bill:
$3,200
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