Question

In the context of purchasing a house, title search, appraisal fees, and origination fees are examples of

	a.	tax deductible expenses.
	b.	monthly payments toward principal.
	c.	monthly payments toward interest.
	d.	closing costs.
	e.	collateral toward the loan.

Due to greater tolerance for allowing loans to people with __________ credit scores, installment loans from consumer finance companies or sales finance companies tend to carry _________ interest rates compared to those of the same installment loans from banks.

	a.	higher; higher
	b.	higher; lower
	c.	lower; higher
	d.	lower; lower

The Federal Deposit Insurance Corporation (FDIC) insures

	a.	banks against a loss of housing value in their mortgages.
	b.	consumer mutual funds against a loss in their market value.
	c.	customer deposits against a decrease in market interest rates.
	d.	customer deposits against the bank closing.
	e.	banks granting mortgages to receive 20% of the original purchase price of the home.

Answer 1

1.Closing costs are the expenses,over and above the price of the property that buyers and sellers normally incur to complete a real estate transactions.It include title search, appraisal fees,origination fees discounts points,title insurance,surveys,taxes,deed recording fees and credit report charges.

Thus,title search, appraisal fees, and origination fees are examples of closing costs.Therefore correct answer is 'option d'.

Monthly payments toward principal and monthly payment towards interest  is the amount paid against the borrowed fund.Thus this is not the correct answer.

The given costs form the part of purchase price of property,they are not tax deductible.

collateral toward the loan is the security given against the loan.