How to Buy a Home



How to Buy a Home

Part 1

This lesson guides students as they decide how much they can afford to spend on a home purchase and what type of home they would like to buy.  It also gives helpful hints in choosing a realtor.


Learning Objectives:


1.    Students will interpret a chart.

2.    Students will list the features they would like in a home.

3.    Students will identify ways to choose a realtor.


Casas Competencies:

1.    1.4.2  select appropriate housing by interpreting information

2.    7.2.7 identify factors involved in making decisions, including considering goals, constraints, and consequences, and weighing alternatives


Materials Needed:

1.    A copy of worksheets 8-A, 8-B, 8-C, 8-D for each student.

2.    One local yellow pages phone book per student ( or as many as possible ).

SUGGESTED ACTIVITIES:


1.    Give each student a copy of worksheet 8-A.  Have a student read the text.  Discuss definitions.  Have at least one copy of your local yellow pages for this lesson.  Ask students to find the listing for “Real Estate Agent” in the phone book.  Discuss the various ads.  Discuss the student answers to questions #1 and #2.


2.    Give each student worksheet 8-B.  Have a student read the text.  Discuss the definitions and any questions the students have.


3.    Give each student worksheet 8-C.  Explain the layout of the chart and note the headings of the columns.  Point out that the intersection of the loan amount and the interest rate is the monthly payment.  Do questions #1 and #2  together as a class.  Give the students help with question #3 as needed.


4.    Give each student worksheet 8-D.  Read the text and discuss the features listed.  Ask the students to share the descriptions of the house they would like to own.


WORKSHEET  8-A

HOW TO CHOOSE A REALTOR

A Real Estate Agent (realtor) is a person whose job is to help people buy and sell property and homes.  A realtor has special training and can help you through the complicated process of buying a home.

It’s important to choose a realtor that you think you can  work with.  They should be friendly and happy to answer your questions.  It would be very good if the realtor speaks your native language or has experience working with immigrants.

Realtors are listed in the yellow pages of the phone book.  You can also ask friends, family members and neighbors if they know a good realtor.

It is a good idea to meet the realtor to decide if you would like to work with them.  If they seem too busy or rude, you should choose another realtor.


Definitions
Property=land acreage
Training=learning how to do something, going to school etc.
Complicated=confusing, difficult to understand
Process=things that happen one after another, a series of actions

1.  Name two important things to look for when choosing a realtor.________________________________________

2.  If the realtor seems too busy and rude, you should__________________________________________

WORKSHEET 8-B


HOW MUCH CAN YOU AFFORD?


One of the first things a realtor will do is help you decide how much you can afford to spend on a home.  It is a good idea to decide how much you can buy even before you meet with the realtor.  Then you will begin looking at homes in your price range.



WHAT IS A MORTGAGE?


When you buy a house, usually you do not have enough money to pay cash for the whole price of the house.  You pay a down payment and borrow the rest of the money.  The borrowed money is called a mortgage.  You make a payment every month (monthly) to the mortgage company that you borrowed from.  They will charge you interest on the money you borrowed.  There are different interest rates on mortgages.  (In Lesson 9 we will learn more about mortgages.)


DEFINITIONS



Price range=the lowest to the highest amount of money you can afford to spend on a house ( example- $50,000-$65,000 )

Down payment=a percentage of the selling price of the house

Interest rates= different percentages of the borrowed amount that has to be paid back

WORKSHEET 8-C

The following chart will help you determine how much you can afford to spend on a house.


Monthly Payments on a 30-Year Fixed Rate Mortgage
(Monthly payments shown include principal and interest only.
Real estate taxes and homeowners insurance are not included.)

Loan Amount                           Interest Rates
                            6.5%     7%     7.5%      8%      8.5%      9%        9.5%      10%

$25,000.00         158    166     175     183     192      201      210       219
$30,000.00         190    200     210     220     231      241      252       263
$35,000.00         221    233     245     257     269      282      294       307
$40,000.00         253    266     280     294     308      322      336       351
$45,000.00         284    299     315     330     346      362      378       395
$50,000.00         316    333     350     367     384      402      420       439
$55,000.00         348    366     385     404     423      443      462       483
$60,000.00         380    399     420     440     462      483      505       527
$65,000.00         411    432     454     477     500      523      547       570
$70,000.00         442    466     489     514     538      563      589       614
$75,000.00         474    499     524     550     577      603      631       658
$80,000.00         506    532     559     587     615      644      673      

1.    Juan Smith wants to buy a house that cost $50,000.00.  He has saved $5,000.00 for a down payment.  He will have to borrow $45,000.00 at 8%.  How much will his monthly payment be?

2.    Teresa Riveres knows she can afford to spend $399.00 a month on a mortgage payment.  The interest rates are at 7% right now.  How much can she afford to spend on buying a house?

    A. $80,000.00       B. $60,000.00       C. $25,000.00

3.    How much can YOU  afford  to borrow from a mortgage company?

*How much do you pay right now for rent?_______

*What are interest rates for mortgages now? (Let’s say they are 7.5%.)______

*Look at the chart under 7.5% and stop when you see the amount you pay for rent right now.

*Look over to the “Loan Amount” column and you will have the amount you can afford to spend on a house.

WORKSHEET 8-D

WHAT KIND OF HOME DO YOU WANT?





Think about the kind of house you want.  Look at the list of ideas to help you decide.



*ranch  (one floor)
*two-story (two floors)
*new home
*older home
*big yard
*small yard
*central air
*fireplace
*brick exterior
*siding
*how many bedrooms?
*how many bathrooms?
(“1 bathroom” means a sink, a shower/tub, and a toilet.  ”1/2 Bath” means a sink and a toilet.)
*close to a school?
*close to shopping?
*close to public transportation (bus)?

Describe the kind of home you would like to buy._____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
Lokasi: Amerika Serikat

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