General Principles Ch 8

Question 1

Paying _______ mortgage principal results in a(n) ________ in net worth.

Answer 1

Down / increase

Because it is a decrease in liabilities

Question 2

The tax cuts and jobs act (TCJA) limited the amount of qualified resident interest that is deductible. The aggregate amount of acquisition indebtedness, and the aggregate amount of home equity indebtedness may not exceed _________ for married filing jointly and single filers and __________ each for married filing separately.

Answer 2

$750,000 / $375,000

Question 3

When evaluating whether a client should refinance a mortgage, the financial planner should consider two key issues: _______ & ________.

Answer 3

Length of time expected to stay in the home and cash flow capacity

Question 4

A reverse mortgage is only available to home owners _____ years of age and older, living in condominiums in single-family homes.

Answer 4

62

Question 5

Reasons to refinance a mortgage:
To obtain a ______ interest rate

To ______ debt

To change the _____ of the loan

To raise extra _____.

Answer 5

Lower / consolidate / term / cash