Concepts Of Home Ownership Flashcards
The decision to buy or rent is influenced by?
Length of time the individual will reside in the area
Individual’s financial situation
Housing affordability
Current mortgage interest rates
Tax consequences of owning versus renting property
What may happen to home prices and tax laws in the future
PITI stands for?
Principle, interest, taxes, insurance.
Capital gains are excluded under what requirements and for how much?
If residence is owned and occupied for 2 of the last 5 years.
$250,000 if single
500,000 if married.
What does PUD stand for and what is it?
A Planned Unit Development (PUD) is a community of homes that could look like single family residences, townhomes or condos, and can include both residential and commercial units
A PUD includes ownership of a “lot,” with common areas either owned by a homeowner’s association (HOA) or collectively by all invested parties.
PUDs often have amenities beyond the scope of most condos, like private tennis courts and outdoor playgrounds that are maintained by HOA fees and only open to homeowners.
Standard home owners insurance covers?
Fire and lightning, windstorm and hail, and glass breakage
Explosion, riot, and civil commotion
Damage by aircraft, vehicles, and smoke
Vandalism, malicious mischief, and theft
Loss of property removed from the premises when it is endangered by fire or other perils
A broad form insurance policy covers?
falling objects and damage due to weight of ice, snow, or sleet;
collapse of all or part of the building;
bursting, cracking, burning, or bulging of steam or water heating system or appliances used to heat water;
accidental discharge, leakage, or overflow of water or steam from within a plumbing, heating, or air-conditioning system;
freezing of plumbing, heating, and air-conditioning systems and domestic appliances; and
damage to electrical appliances, devices, fixtures, and wiring from short circuits or other accidentally generated currents.
What does a coinsurance clause do?
requires the homeowner to maintain insurance equal to at least 80 percent of replacement cost of the dwelling for full replacement on loss; or
if not, the loss will be settled for actual cash value or a prorated amount.
What does CLUE stand for and what does it do?
Comprehensive Loss Underwriting Exchange (CLUE) is a database of consumer insurance claim history.
The National Flood Insurance Act of 1968?
subsidizes flood insurance, and
is administered by the Federal Emergency Management Agency (FEMA).
