1. Efforts to increase homeownership include all the following EXCEPT
A) requiring lower down payments.
B) penalizing first-time homebuyers for using fun... [Show More] ds from IRA's.
C) requiring loan applicants to have better credit.
D) lowering closing costs for first-time home buyers.
C) requiring loan applicants to have better credit.
The real cost of owning a home includes certain costs/expenses that many people
overlook. Which of the following is NOT such a cost/expense of home ownership?
A) Income lost on cash invested in the home
B) Interest paid on borrowed capital
C) Maintenance and repair expenses
D) Personal property taxes
D) Personal property taxes
Margie listed her real estate for sale at $100,000. If her cost was 80 percent of the listing
price, what will her percentage of profit be when her real estate is sold for the listing
price?
A) 10 percent
B) 15 percent
C) 20 percent
D) 25 percent
D) 25 percent
Most homeowner's insurance policies contain which of the following clauses?
A) A property improvement clause
B) A coinsurance clause
C) A co-ownership clause
D) A property devaluation clause
B) A coinsurance clause
That portion of the value of owners' property that exceeds the amount of their mortgage
debt is called
A) equality.
B) escrow.
C) surplus.
D) equity.
D) equity.
Homeowners may deduct all of the following expenses when preparing their income
tax return EXCEPT
A) real estate taxes.
B) mortgage interest on a first home.
C) mortgage interest on a second home.
D) mortgage interest on a third home.
D) mortgage interest on a third home.
If a homeowner's insurance policy provides coverage for less than 80 percent of the full
replacement cost of the dwelling, then the loss of the residence will be settled for
A) the market value of the property less the land value.
B) the lowest repair bid.
C) either the actual cash value or the prorated repair cost.
D) the total replacement cost.
C) either the actual cash value or the prorated repair cost.
The Levines sold their vacation home for $188,000. If they made a profit of 10 percent,
what was the original cost of their property?
A) $169, 200
B) $179,000
C) $179,200
D) $170,900
D) $170,900
The selling price of a property is $96,000. This can be financed if the buyer can put 10
percent down and pay a loan origination fee of 1.5 percent. How much cash must the
buyer produce to complete this transaction?
A) $10,080
B) $10,896
C) $11,040
D) $11,084
B) $10,896
Federal income tax law excludes gain realized on the sale of a primary residence for
individuals filing separately and for couples filing jointly. The amount of this exclusion
is (separately/jointly):
A) $100,000/$200,000
B) $125,000/$250,000
C) $250,000/$500,000
D) $300,000/$600,000
C) $250,000/$500,000
Damage from which of the following is NOT covered in a basic homeowner's policy?
A) Fire and lightning
B) Explosion
C) Windstorm and hail
D) Flood
D) Flood
Federal income tax regulations allow homeowners to reduce their taxable income by
amounts paid for
A) repairs and maintenance.
B) hazard insurance premiums.
C) real estate taxes.
D) principal and interest.
C) real estate taxes.
When Homeowner Harry's sold his residence recently, he found that he had more than
$20,000 in equity. This equity did NOT come from
A) the use of an interest-only mortgage payment plan.
B) the principal portion of his PITI monthly mortgage payments.
C) increases in market value of his house due to appreciation and inflation.
D) his down payment.
A) the use of an interest-only mortgage payment plan.
The buyer of a $125,000 home has paid $2,000 as earnest money and has a loan
commitment for 70 percent of the purchase price. The balance of the cash the buyer
needs to complete the transaction is
A) $3,500.
B) $35,500.
C) $37,000.
D) $37,500.
B) $35,500.
Which of the following type of development combines office space, stores, and
residential units in a single, vertical community known as a
A) planed unit development
B) manufactured housing park
C) mixed -use development
D) time-share community
C) mixed -use development
Three years ago Dr. and Mrs. Henderson moved from the house they had owned for 20
years, but did not sell it. They decided to travel and bought a mobile home to live in.
They now sell the house. How much of their capital gain on the house will be taxable?
A) 15 percent, depending on their tax bracket
B) 28 percent, depending on their tax bracket
C) All of it, if it is over $500,000
D) None of it, if it is less than $500,000
D) None of it, if it is less than $500,000
The purchaser of a property in a planned unit development will usually NOT receive
A) an interest in the unit owners' association.
B) a direct ownership interest in the common areas.
C) title to the land on which the unit is built.
D) a share in the control of the commonly-owned elements.
B) a direct ownership interest in the common areas.
The phrase "bundle of legal rights" is properly included in
A) the definition of real property.
B) a legal description.
C) real estate transactions.
D) leases for less than one year.
A) the definition of real property.
All of the following are included in the right to control one's property EXCEPT
A) The right to sell the property to a neighbor
B) The right to exclude the utilities' meter reader
C) The right to erect "no trespassing" signs
D) The right to enjoy profits from its ownership
B) The right to exclude the utilities' meter reader [Show Less]
