If you think you've mastered the material in this chapter, take our quiz. After you click the "submit" button, the answers will appear below.What are some of the benefits of homeownership?Deductibility of mortgage interest.Real estate is the best investment around.Interest paid on mortgage is usually deductible on taxes.A and C.A and B.When deciding whether to grant a loan, mortgage lenders look closely at something called the ''housing expense ratio.'' What is that?It is a financial ratio comparing the number of vacant homes in a neighborhood to a national vacancy average. It tells the lender whether property values are likely to rise, and therefore whether it's smart to make that loan.The housing expense, or front-end, ratio shows how much of your gross (pretax) monthly income would go toward the mortgage payment.What else will you have to consider when deciding how much house you can afford?Property taxes.Insurance.Both.Neither. advertisementRelated Links:Mortgage or credit card debt? Which to pay firstUsing an IRA for a down payment, tax-freeWorried worker: Spend savings on mortgage?Related Articles:Mortgage vs. card debt?Time to re-refi mortgage?Interest Rate Roundup
If you think you've mastered the material in this chapter, take our quiz. After you click the "submit" button, the answers will appear below.
What are some of the benefits of homeownership?
When deciding whether to grant a loan, mortgage lenders look closely at something called the ''housing expense ratio.'' What is that?
What else will you have to consider when deciding how much house you can afford?
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Remember the wise decision that Bank of America made in August 2001 in light of the decision it's making now.
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