Understanding Business and Personal Law

Chapter 34: Buying a Home

Buying a Home


1.	Tenancy in common is
		A)	based on a common-law doctrine that a husband and wife are regarded by the law as one.
		B)	a type of co-ownership in which two or more people own an interest in the whole property.
		C)	based on the theory that most owners would prefer their heirs inherit their property.
		D)	a type of ownership where only one person owns the property.


2.	The most popular type of home is a
		A)	condominium.
		B)	mobile home.
		C)	single-family home.
		D)	multifamily home.


3.	A gradual-payment mortgage has
		A)	lower monthly payments which rise gradually and then level off for the duration of the term.
		B)	monthly payments based on a fixed interest rate that rise gradually throughout the duration of the term.
		C)	a fixed interest rate and payments that lower gradually for the first two years of the term.
		D)	a below-market interest rate which rises gradually and then levels off for the duration of the term.


4.	A mortgage lender is exempt from having to provide a truth-in-lending statement to you.
		A)	TRUE
		B)	FALSE


5.	All mortgages require a down payment.
		A)	TRUE
		B)	FALSE


6.	When you become a homeowner, you own the ground below the surface of your property to the center of the earth.
		A)	TRUE
		B)	FALSE


7.	When the government takes private property, with compensation, for public use it is called
		A)	easement possession.
		B)	adverse possession.
		C)	zoning domain.
		D)	eminent domain.


8.	An ARM has an interest rate that moves up and down during the term of the mortgage.
		A)	TRUE
		B)	FALSE


9.	Your debt ratio is the amount of your mortgage payment divided by the total mortgage.
		A)	TRUE
		B)	FALSE


10.	As you pay off the mortgage and the property increases in value, you will see a gradual increase in your
		A)	eminent domain.
		B)	mortgage payment.
		C)	equity.
		D)	debt ratio.