Process of Renting an apartment
1.How much can you afford to spend on a house?
2.5 times your annual income
1.How much can you afford on rent?
25% of your monthly net income or about 1 week's paycheck
1.David makes $5,000 each month. How much can he afford to spend on a house?
$150,000
1. What is the difference between an lease and a loan?
Lease is a contract signed when renting. Mortgage is a contract signed with a bank when buying a house.
2. What is an additional cost you have when purchasing a house other than the cost of the house itself?
Closing costs, real estate agent, taxes, insurance, inspections
2. Jake makes $2,000 weekly. How much can he afford to spend on rent each month?
$2166.67 or about 1 week's salary ($2000)
2. John and Rebecca want to purchase a bigger home. John just got a raise and now makes $89,000 annually, while Rebecca makes $58,000 a year. They have two car payments that total to $925. They also have a current mortgage of $1,300. Rebecca still has student loans and is paying $400 a month towards it. What is their debt-to-income ratio?
21%
2.What is disadvantage to renting?
No ownership, Rent can increase over time, Limited freedom (rules about pets, decorating, etc.), Less privacy (neighbors, shared walls), Money spent on rent is not an investment
3. A clause in a purchase contract that describes conditions that must be met before the contract is signed
Contingency
3.´Jen makes $62,000 annually. How much can she afford to spend on rent each month?
About $1291.67
3. Sam is interested in purchasing a new home. The home she wants is listed at $215,000. She has obtained a 15-year mortgage and was able to get a low interest rate of 4.375%. What is her monthly payment?
$1631.03
True or False: Loss of wages are covered under homeowner's insurance
False
4.The value of the property after subtracting the loan balance
Equity
4. Faith and Gail have an apartment. They pay $525 a month for rent, $60 a month for heat, $40 a month for water, and $75 a month for electric. They agree to split all costs. What is Faith's monthly rental expenses?
$350
4. True or False: An attorney fee can be part of a closing cost.
True
4. Along with property taxes, what are the other type of taxes you need to pay when buying a house?
Municipal/Local, School, and County
5.A response to a previous offer that rejects all of part of it while enabling negotiations to continue
Counter Offer
5. Corey's insurance company charges him 2% of the value of his property for rental insurance for the year. Corey's owns $8000 worth of property. What is Corey's monthly rental insurance?
$13.33
5.Suppose your property is assessed at $175,000 and the tax rate is 3.5 mills. Calculate the amount of taxes on the property.
$612.50
5. Name 3 key feature of a lease when renting.
How much to pay per month? When is the rent due? Amount of the security deposit. Who is paying for utilities? Pets? Parking? Alterations? Right of entry and inspection. Length of lease, Late fees?