7. Property Taxes, Insurance, and Impounds Quiz
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Questions and Answers

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?

    <p>Monthly</p> Signup and view all the answers

    What is a supplemental property tax in real estate?

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

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

    <p>Loan amount x a certain percentage</p> Signup and view all the answers

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

    <p>Splitting costs or payments between buyer and seller</p> Signup and view all the answers

    What determines the amount of HOA fees?

    <p>Location, property size, and community amenities</p> Signup and view all the answers

    What do HOA fees primarily fund in a housing community?

    <p>Landscaping and trash services</p> Signup and view all the answers

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

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

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

    <p>2%</p> 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?

    <p>$125</p> 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?

    <p>$2,600</p> 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?

    <p>$495</p> 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?

    <p>$1,800</p> 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?

    <p>$3,500</p> 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?

    <p>1.40%</p> 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?

    <p>$150,000</p> 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?

    <p>$30,000</p> 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?

    <p>$470</p> Signup and view all the answers

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