Mortgages and Home Ownership

Question 1

$200,317$193,429$195,104

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$195,104; According to the chart, Demarco and Tanya will pay a total of in interest over the life of their loan.: $195,104; This means their total cost, including the purchase price, is approximately .: $374,323; This amount is than what they would pay in total using the fixed-rate mortgage.: higher

Question 2

$340,323$363,429✔ $374,323

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✔ $374,323

Question 3

✔ higherlower

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✔ higher

Question 4

principalinterest

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interest; According to the chart, by year 10, the majority of Demarco and Tanya’s payment will go toward the .: interest; By year 20, the majority of Demarco and Tanya’s payment will go toward the .: principal; Over time, the amount paid toward the principal will .: increase

Question 5

✔ principalinterest

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✔ principal

Question 6

✔ increasestay constantdecrease

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✔ increase

Question 7

$169$667$836

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$836; According to the chart, by year 5, the combined payment for principal and interest will increase to approximately .: $836; By year 15, the combined payment will increase to approximately .: 961; Recall that taxes and mortgages add about $400 to the payment for principal and interest. If Demarco and Tanya’s income stays the same, by year 10, their total payment will be 25% of their gross month: over

Question 8

289672✔ 961

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✔ 961

Question 9

✔ overunder

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✔ over

Question 10

$711$811$911

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$811; According to the chart, the initial monthly payment Demarco and Tanya should anticipate paying on principal and interest is .: $811; They should budget $400 for insurance and tax payments, so the total amount they should anticipate paying monthly is .: $1,211

Mortgages and Home Ownership Answers

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