Unit 3: Concepts & Responsibilities of Home Ownership Flashcards
condominium
absolute ownership pf an apartment or unit plus undivided interest in common elements
Cooperative
residential multiunit building held by a corporation that is owned and operated for the benefit of persons living within the building who are stockholders of the corporation
Planned Unit Development (PUD)
planned combo of diverse land uses such as housing, recreation, & shopping
mixed use property
accommodates more than one use such as commercial and residential
manufactured homes
constructed in a controlled factory environment built to Federal Manufactured Home Construction & Safety Standards (HUD Code)
Modular Homes
constructed with large wall & roof components in a factory
time sharing
permission is given to use certain property for certain intervals of time
investment
money directed toward the purchase, improvement, and development of an asset in expectation of income or profits
equity
current market value of a property minus and loans
capital gain
income earned from the sale of an asset
Homeowners Insurance Policy
covers a residential RE owner against financial loss on a dwelling and its contents & includes liability coverage and loss of use
endorsement
additional document attached to an original insurance policy that amends the original; a rider
coinsurance clause
provision covering real property that requires policyholder to maintain coverage generally equal to at least 80% of the actual replacement cost
deductible clause
limits the exposure to the loss or an insured homeowner
Federal Emergency Management Agency (FEMA)
sets program standards for flood insurance
Prospective homebuyers should evaluate the desirability of the community based on…
cultural activities, employment opportunities, recreational and social facilities, transportation, etc.
What should be considered if you’re thinking of purchasing a home?
initial price and the continuing expenses
Lenders can still be flexible based on…
the type of loan, borrowers credit history, and their capacity to pay
How can a property owner increase equity?
by paying off debts on the property
What are some income tax benefits available to homeowners?
deduction of mortgage interest payments, loan discount points, and property taxes from their federal income taxes, subject to certain criteria and limitations
Married homeowners who file jointly can…
exclude up to $500,000 of capital gains on the sale or exchange of a principal residence
What will flood insurance cover?
insured structures damaged by flood event. vehicles, lawns, and livestock are not covered
