1. The one-year treasury rate is never used as an index for an adjustable-rate mortgage because the interest rate that the government pays never changes.
1. The one-year treasury rate is never used as an index for an adjustable-rate mortgage because the interest rate that the government pays never changes.
True or False
2. Amazon's Housing Equity Fund is supporting the construction of housing for low to moderate-income families in the New York Metropolitan area.
True or False
3. You are going to buy a home for $500,000. You are trying to decide between a issuing a 30 year fixed rate mortgage or a 15 year fixed rate mortgage to finance 80% of the price. Your objective is to have lower montlhy payments. The interest rate on the 30 year loan is 4.24% and on he 15 year loan the interest rate is 3.365%. You should choose the 15 year loan.
Use the following mortgage calculator
https://fm.fanniemae.com/homeownership/resources/financial-calculators/mortgage-calculator
True or False
4. A property costs $5 million. It will generate positive cash flows for years 1-15. Cash flow in year 1 is $200,000. Cash flows grow by 20% per year. The property is sold for $5,500,000 at the end of year 15. Your firm will only make real estate investments that offer an
In this case your firm should make the investment.
True or False
5. Base your answers to the following questions on data from:
https://www.zillow.com/mortgage-rates/
The rates on 5/1 ARMs and 30-year fixed-rate mortgages are currently within 50 basis points of each other.
True or False
6. Base your answers to the following question on the property for sale described in the following link:
http://www.bouldergroup.com/media/pdf/Starbucks%20-%20Savage,%20MN%20-%20OM.pdf
The offering memorandum gives demographic and commercial information about the area in which the property is located. This is relevant because the value of the property depends volume of the retail traffic and the income of the people who shop in the area.
True or False
7. I am not able to make my mortgage payments. The amount I owe the lender is more than the value of my home. I ask the lender if I can do a short sale of my home. The lender agrees. The proceeds from the short sale are used to pay the lender. In some cases, this can be a less costly resolution to default than foreclosure for both the borrower and lender.
True or False
8. A 5/1 adjustable rate mortgage has a fixed rate period for five years and then the rate can adjust once every year.
True or False
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