7. Property Taxes, Insurance, and Impounds Quiz

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What is the key purpose of a standard homeowner's insurance policy?

To increase the home's market value

To insure the homeowner's personal belongings

To cover rental costs

To insure the home against specific risks, such as fire or theft (correct)

What is the primary role of the California Board of Equalization in real estate?

To regulate real estate agents

To provide mortgages

To oversee property tax assessments (correct)

To manage HOA disputes

In real estate context, what are impounds related to?

Penalties for late mortgage payments

Special police units for property security

Accounts for managing property taxes and insurance (correct)

Fees for home inspections

When are HOA fees typically due?

Monthly Signup and view all the answers

What is a supplemental property tax in real estate?

An additional tax due when property changes ownership or new construction is completed Signup and view all the answers

What is typically used to calculate a standard form of homeowner's insurance?

Loan amount x a certain percentage Signup and view all the answers

In real estate transactions, what do 'pro-rations' refer to?

Splitting costs or payments between buyer and seller Signup and view all the answers

What determines the amount of HOA fees?

Location, property size, and community amenities Signup and view all the answers

What do HOA fees primarily fund in a housing community?

Landscaping and trash services Signup and view all the answers

What does the 80/20 rule indicate about homeowner's insurance coverage?

Insurance must cover at least 80% of your home's replacement value Signup and view all the answers

Under Proposition 13, by what percentage can the assessed value of a property increase annually?

2% Signup and view all the answers

If a homeowner's total annual property tax is $1,500, how much do they pay monthly if they choose to pay on an installment basis?

$125 Signup and view all the answers

If a standard homeowner's insurance policy costs are 0.4% of the loan amount and the loan is $600,000, what is the annual insurance cost?

$2,600 Signup and view all the answers

If a new construction increases a property's assessed value by $45,000 and the tax rate is 1.1%, what is the annual tax increase?

$495 Signup and view all the answers

If a standard homeowner's insurance policy costs 0.3% of the loan amount and the loan is $500,000, what is the annual insurance cost?

$1,800 Signup and view all the answers

What is the estimated annual property tax for a home purchased for $250,000 using the 1.25% rule of thumb?

$3,500 Signup and view all the answers

For a home purchased for 150,000, if the annual property tax is 2,000, what is the effective property tax rate?

1.40% Signup and view all the answers

If the property tax rate is 1.5% and the annual property tax is $2,250, what is the assessed value of the property?

$150,000 Signup and view all the answers

If Buyer Bill purchases a home for $150,000 with an 80% mortgage, how much is his down payment?

$30,000 Signup and view all the answers

If a property's assessed value increases by $45,000 and the tax rate is 1.1%, what is the new annual tax increase?

$470 Signup and view all the answers