Question 1

Condominiums involve the purchase of an individual living unit rather than an entire building.

Accepted Answer

A) True 
 B)False

Question 2

Given the following, calculate the GDS ratio.All income and expense items are annual.

Accepted Answer

A)  28%
B)  41%
C)  50%
D)  59%
E)  64%F) A) and B)
G) A) and E)

Question 3

The most common service provided by a real estate agent when selling your home is

Accepted Answer

A)  providing legal advice.
B)  qualifying buyers for a mortgage.
C)  screening potential buyers.
D)  making needed repairs.
E)  getting you the lowest offerF) A) and B)
G) B) and E)

Question 4

Lenders commonly use a TDS ratio of _________ and a GDS ratio of __________ to help determine the amount most people can comfortably afford for housing.

Accepted Answer

A)  20%; 30%
B)  40%; 20%
C)  40%; 30%
D)  30%; 20%
E)  20%; 40%F) A) and E)
G) A) and D)

Question 5

A real estate agent can best assist a homebuyer by

Accepted Answer

A)  assisting in getting a mortgage
B)  setting the purchase price.
C)  offering new home warranties.
D)  assisting you in obtaining financing.
E)  paying the first month's mortgage payment.F) A) and B)
G) A) and D) D

Question 6

Given the following, calculate the TDS ratio.All income and expense items are annual.

Accepted Answer

A)  28%
B)  41%
C)  50%
D)  74%
E)  84%F) A) and E)
G) B) and D)

Question 7

The Gross Debt Service (GDS)  ratio measures:

Accepted Answer

A)  your monthly mortgage payment, including any outstanding debt as a percentage of gross monthly income.
B)  your monthly mortgage payment, including principal, interest, heating, and taxes as a percentage of gross monthly income.
C)  your monthly mortgage payment as a percentage of gross monthly income.
D)  your annual mortgage payment, including any outstanding debt, as a percentage of gross annual income.
E)  your annual mortgage payment, including principal, interest, heating, and taxes, as a percentage of gross annual income.F) All of the above
G) C) and E) B

Question 8

Qualifying for a mortgage is much different then obtaining other forms of credit.

Accepted Answer

A) True 
 B)False

Question 9

If your CMHC premium percentage is 1.8%, what is the maximum loan to value ratio?

Accepted Answer

A)  65%
B)  75%
C)  80%
D)  85%
E)  90%F) A) and C)
G) A) and B)

Question 10

The main financial benefit of owning is

Accepted Answer

A)  lower living expenses.
B)  don't pay GST.
C)  investment value growth.
D)  lower initial costs.
E)  high financial commitment.F) B) and C)
G) A) and E)

Question 11

Renting would be most appropriate for people who

Accepted Answer

A)  own a variety of pets.
B)  have difficulty establishing credit.
C)  want to reduce their taxes.
D)  enjoy remodeling their residence.
E)  desire the financial benefits of increased equity.F) B) and D)
G) B) and C)

Question 12

As William Quintal conducts an investigation of property value factors, most real estate experts tell him that ____________ most influences the housing values in an area.

Accepted Answer

A)  community pride
B)  style of homes
C)  quality of schools
D)  age of neighborhood
E)  zoning lawsF) A) and E)
G) All of the above

Question 13

Renting is more advantageous than buying a home for

Accepted Answer

A)  lower short-term living costs.
B)  financial benefits.
C)  long-term investment purposes.
D)  receiving tax benefits.
E)  permanence of residence.F) None of the above
G) B) and C) A

Question 14

Step two of the home buying process is?

Accepted Answer

A)  Determine home ownership needs
B)  Find and evaluate a property to purchase
C)  Price the property
D)  Obtain Financing
E)  Close the purchase transactionF) A) and E)
G) A) and D)

Question 15

Which of the following is an example of a closing cost?

Accepted Answer

A)  origination fee
B)  mortgage application fee
C)  earnest money
D)  title insurance
E)  down paymentF) A) and D)
G) All of the above

Question 16

You made a $100,000 down payment on a $400,000 house and financed the remaining amount with a Canadian fixed-rate mortgage.Your mortgage has a term of three years, an amortization period of 25 years, a quoted rate of 7% and payments are made monthly.Identify the correct statement.

Accepted Answer

A)  The 7% quoted rate does not represent the effective annual rate charged on the mortgage.
B)  The interest rate is fixed for 25 years.
C)  You will make a total of 36 monthly payments to pay off the mortgage.
D)  You have a high-ratio mortgage.
E)  Your interest rate is fixed for 3 years, variable for 22 years.F) A) and D)
G) A) and E)

Question 17

A property survey typically costs (for the purchase of a home) ?

Accepted Answer

A)  $200-300
B)  $750-1000
C)  $400-1500
D)  $500-2000
E)  $2,000+F) All of the above
G) C) and E)

Question 18

Given the following, calculate the GDS ratio.All income and expense items are annual.

Accepted Answer

A)  28%
B)  41%
C)  44%
D)  52%
E)  63%F) B) and D)
G) A) and E)

Question 19

Brian Pittman rents a living unit as a result of his membership in a nonprofit housing organization.What name is commonly used for this type of housing?

Accepted Answer

A)  modular housing
B)  government-subsidized housing
C)  zoned housing
D)  a condominium
E)  cooperative housingF) None of the above
G) A) and E)

Question 20

Renting is more advantageous than buying a home for

Accepted Answer

A)  minimal financial commitment.
B)  financial benefits.
C)  long-term investment purposes.
D)  receiving tax benefits.
E)  permanence of residence.F) A) and B)
G) A) and E)

Exam 7: The Finances of Housing

Condominiums involve the purchase of an individual living unit rather than an entire building.

Correct AnswerverifiedShow Answer

Given the following, calculate the GDS ratio.All income and expense items are annual.

Correct AnswerverifiedShow Answer

The most common service provided by a real estate agent when selling your home is

Correct AnswerverifiedShow Answer

Lenders commonly use a TDS ratio of _________ and a GDS ratio of __________ to help determine the amount most people can comfortably afford for housing.

Correct AnswerverifiedShow Answer

A real estate agent can best assist a homebuyer by

Correct AnswerverifiedD

Given the following, calculate the TDS ratio.All income and expense items are annual.

Correct AnswerverifiedShow Answer

The Gross Debt Service (GDS) ratio measures:

Correct AnswerverifiedB

Qualifying for a mortgage is much different then obtaining other forms of credit.

Correct AnswerverifiedShow Answer

If your CMHC premium percentage is 1.8%, what is the maximum loan to value ratio?

Correct AnswerverifiedShow Answer

The main financial benefit of owning is

Correct AnswerverifiedShow Answer

Renting would be most appropriate for people who

Correct AnswerverifiedShow Answer

As William Quintal conducts an investigation of property value factors, most real estate experts tell him that ____________ most influences the housing values in an area.

Correct AnswerverifiedShow Answer

Renting is more advantageous than buying a home for

Correct AnswerverifiedA

Step two of the home buying process is?

Correct AnswerverifiedShow Answer

Which of the following is an example of a closing cost?

Correct AnswerverifiedShow Answer

You made a $100,000 down payment on a $400,000 house and financed the remaining amount with a Canadian fixed-rate mortgage.Your mortgage has a term of three years, an amortization period of 25 years, a quoted rate of 7% and payments are made monthly.Identify the correct statement.

Correct AnswerverifiedShow Answer

A property survey typically costs (for the purchase of a home) ?

Correct AnswerverifiedShow Answer

Given the following, calculate the GDS ratio.All income and expense items are annual.

Correct AnswerverifiedShow Answer

Brian Pittman rents a living unit as a result of his membership in a nonprofit housing organization.What name is commonly used for this type of housing?

Correct AnswerverifiedShow Answer

Renting is more advantageous than buying a home for

Correct AnswerverifiedShow Answer

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Lenders commonly use a TDS ratio of _ and a GDS ratio of __ to help determine the amount most people can comfortably afford for housing.

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D

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B

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A

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