Are You A Mortgage Genius Or A Mortgage Idiot?

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| By Fullbeaker

Fullbeaker

Community Contributor

Quizzes Created: 1 | Total Attempts: 233

Questions: 10 | Attempts: 233 | Updated: Mar 16, 2023

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Are You A Mortgage Genius Or A Mortgage Idiot? - Quiz

Test your knowledge! This quiz will tell you your mortgage IQ. Are you ready to buy a home?

Questions and Answers

1.

What’s the minimum down payment required to buy a house?
- A.
  
  0%
- B.
  
  3.5%
- C.
  
  5%
- D.
  
  20%
Correct Answer
A. 0%

Explanation
The correct answer is 0%. USDA and VA loans do not require a down payment. FHA loans require 3.5% down and conventional loans with private mortgage insurance typically require at least 5% down. Learn more about available loan types here or get in touch with qualified mortgage lenders now by visiting www.mymortgageinsider.com

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2.

The news is always talking about the Federal Reserve and interest rates. Are mortgage interest rates determined by the Fed?
- A.
  
  Yes
- B.
  
  No
Correct Answer
B. No

Explanation
The correct answer is no. The Federal Reserve has some influence, but mortgage interest rates are determined by investors. So they change daily and throughout the day. It’s important to get quote from multiple lenders so you know you’re comparing apples to apples. Start your search at MyMortgageInsider.com and we’ll connect you with up to four lenders.

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3.

Let’s put today’s mortgage rates – which are in the mid 4% range - in context. In the year 2000, 30 year fixed interest rates were in the…
- A.
  
  High 6% range
- B.
  
  Low 5% range
- C.
  
  Low 7% range
- D.
  
  Mid 8% range
Correct Answer
D. Mid 8% range

Explanation
Mid 8% range. In May of 2000, the 30 year fixed rate loan averaged 8.52% according to Freddie Mac. A 250k loan would have cost you $650 more per month. And rates could rise again. Lock in your rate here. (Don’t worry – we’ll open a new window so you can finish the quiz.)

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4.

If I have less-than-perfect credit, I’ll most likely qualify for a(n) ____ loan…
- A.
  
  FHA, USDA, or VA
- B.
  
  Jumbo
- C.
  
  Conventional
Correct Answer
A. FHA, USDA, or VA

Explanation
The correct answer is an FHA, USDA, or VA loan since these loan types allow for lower credit scores. Conventional and jumbo loans are typically for high-credit borrowers. Learn how the right loan type can help you qualify at www.mymortgageinsider.com.

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5.

I know all about fixed rate 30 year loans, but what about an ARM? An ARM is...
- A.
  
  Adjustable Rate Mortgage
- B.
  
  Another Ripoff Mortgage
- C.
  
  Adjustable Rising Mortgage
- D.
  
  I have no idea but they are definitely bad news
Correct Answer
A. Adjustable Rate Mortgage

Explanation
The correct answer is an Adjustable Rate Mortgage. An ARM loan might be a good idea if you plan to sell or refinance in the near future, since they provide a very low initial rate. Be careful though. If you keep your mortgage longer than planned, you could end up with a high interest rate. To get in touch with a qualified mortgage lenders right now visit www.mymortgageinsider.com.

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6.

I can have my credit pulled up to ___ times by different mortgage lenders in a 14-day period and have only one inquiry added to my credit report.
- A.
  
  2
- B.
  
  4
- C.
  
  10
- D.
  
  Unlimited
Correct Answer
D. Unlimited

Explanation
The correct answer is Unlimited. As long as the same type of creditor pulls your credit within a 14-day period, it only counts as one inquiry on your credit report. So there is no downside to shopping around and getting multiple quotes. To get in touch with qualified mortgage lenders right now visit www.mymortgageinsider.com

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7.

By law, all lenders must charge the same amount in fees
- A.
  
  True
- B.
  
  False
Correct Answer
B. False

Explanation
The correct answer is False. Lenders fees can vary greatly, so be sure to get multiple quotes. A quote should include the interest rate and a full breakdown of fees as well. Get quotes from up to four lenders here.

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8.

I need a mortgage pre-qualification before making an offer on a home.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
The correct answer is True. Real estate agents won’t let you write up an offer on a home until you have a pre-qualification from a lender. Get prequalified here.

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9.

On a conventional loan, I don't need private mortgage insurance (PMI) if I make a 20% or greater down payment.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
The correct answer is True. You will only need PMI if your down payment is less than 20%. Learn about various types of mortgages at MyMortgageInsider.com.

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10.

When talking about mortgages, a “point” is a fee paid to the mortgage lender or broker. A point is equal to:
- A.
  
  1% of the loan amount
- B.
  
  0.10% of the loan amount
- C.
  
  1% of the purchase price
- D.
  
  1% of the money I have in my checking account
Correct Answer
A. 1% of the loan amount

Explanation
The correct answer is 1% of the loan amount. Did you know you can negotiate mortgage points? Get quotes from multiple lenders and negotiate the best rate, point, and fee combination.

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Current Version
Mar 16, 2023

Quiz Edited by
ProProfs Editorial Team
Aug 01, 2013

Quiz Created by
Fullbeaker

Are You A Mortgage Genius Or A Mortgage Idiot?

What’s the minimum down payment required to buy a house?

The news is always talking about the Federal Reserve and interest rates. Are mortgage interest rates determined by the Fed?

Let’s put today’s mortgage rates – which are in the mid 4% range - in context. In the year 2000, 30 year fixed interest rates were in the…

If I have less-than-perfect credit, I’ll most likely qualify for a(n) ____ loan…

I know all about fixed rate 30 year loans, but what about an ARM? An ARM is...

I can have my credit pulled up to ___ times by different mortgage lenders in a 14-day period and have only one inquiry added to my credit report.

By law, all lenders must charge the same amount in fees

I need a mortgage pre-qualification before making an offer on a home.

On a conventional loan, I don't need private mortgage insurance (PMI) if I make a 20% or greater down payment.

When talking about mortgages, a “point” is a fee paid to the mortgage lender or broker. A point is equal to: