Guide to Buying a Home

Is this course right for me?

Be it ever so humble, the "biggest" purchase you ever make may be your home. Unlike most other consumer purchases, a home is expected to be more than a living space; it is also an asset that stores and increases value. The house has a dual financial role as both a nest and a nest egg. This course serves to be an educational overview of the potentially overwhelming process of buying a home, including how to determine what home is the best fit, financing options, the purchase process, and avoiding foreclosure.

This course content is licensed under a Creative Commons by-nc-sa 3.0 license. This content has been accessible since December 29, 2012, and it was downloaded then by Andy Schmitz in an effort to preserve the availability of this book. More information is available on this project's attribution page.

Course Goals/Objectives

  • Explain the different types of building structures for residential dwellings
  • Discuss the various types of ownership structures
  • Identify the factors that lenders use to evaluate potential borrowers for mortgage credit
  • Outline the components of a buyer's inspection checklist
  • Explain the potential effects of business cycles, unemployment, and inflation on the housing market
  • Define what a down payment is and what effects it has on other housing costs
  • Calculate the monthly mortgage payment based on the interest rate, loan maturity, and the principal balance
  • Distinguish between a fixed-rate and an adjustable-rate mortgage and explain how each effects the monthly payment and interest rate
  • Recognize potential closing costs
  • Identify the components of a purchase and sale agreement
  • Discuss the financing events that may be encountered during the maturity of a mortgage
  • Define the borrower's and the lender's responsibilities to the mortgage
  • Explain the consequences of defaulting on a mortgage and overview the term foreclosure
IMPORTANT: Drive's "Guide to Buying a Home" course is a condensed version of a full-length course titled Individual Finance. These three individual lessons have been intentionally selected for the purposes of training and education. In order to proceed through the course, click on each individual lesson link below and review the corresponding lesson material. When you reach the end of the lesson, click the "I'm Done" button at the top of the screen to navigate back to course menu and then proceed to the next lesson. Note: A chapter navigation menu may appear at the top of some lessons, but this menu WILL NOT direct you to any of the other lessons designed for this course.

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