Mortgage know-it-all? Prove it! Updated on: Jun 12, 2018

Correct! Incorrect. The answer is: False.

Actually, it's possible to put as little as 3.5 percent of the purchase price down (or even zero in some cases!). FHA and certain Community Lending Programs are widely available; you'll have to pay private mortgage insurance, though.

Correct! Incorrect. The answer is False.

PMI is a policy you pay for that protects the lender -- not you -- if you should default on your mortgage.

Correct! Incorrect. The answer is: False.

Lenders in the market today offer many different pricing options. You can pay points with no other fees, no points with other fees, or no points or fees whatsoever. You'll normally get a slightly higher interest rate than if you did pay fees, however.

Correct! Incorrect. The answer is: False.

A "hybrid ARM" is a product that is fixed for a short or medium period of time -- for three, five, seven or 10 years -- then becomes a standard one-year ARM for the remainder of a 30-year term.

Correct! Incorrect. The answer is: True.

Also known as getting preapproved for a mortgage, most mortgage lenders will issue you a “conditional commitment” to lend you a mortgage before you shop for a home. Of course, the property you choose must pass appraisals, and you'll need to get your paperwork in order. Some mortgage lenders will even let you lock in an interest rate! But first, you'll need to know which mortgage type and loan features you want.

Correct! Incorrect. The answer is: False.

Refinancing can actually cost you money over the long haul, even if you get a great break on your interest rate and monthly payments today. Restarting the "amortization clock" with a new 30-year term can mean many additional years of payments and thousands more in interest costs. On the other side of the coin, paying fees and points to get a great rate can all turn into a loss if you don't stay in the loan at least long enough to get your money back!

Correct! Incorrect. The answer is: False.

Monthly payments on a 15-year mortgage aren't double that of a 30-year mortgage. Right now, a 15-year mortgage payment would be about 45 percent higher than that of a 30-year term. At the same time, total interest costs on a 30-year term aren't twice as much, but about two-and-a-half times as much! The lower monthly payments on a 30-year term can be a draw, but the long-term interest costs can be a drawback, so a shorter-term mortgage can be the way to go if you've got the cash.

Correct! Incorrect. The answer is: False.

For mortgages issued until 12/14/2017, interest on loan amounts of up to $1,000,000 is deductible from your federal taxes. For loans made after 12/15/2017, the maximum loan amount on which interest is deductible is $750,000 -- and anything over these limits is not deductible. Also, unless it is used to "buy, build or substantially improve the taxpayer’s home" interest on home equity debt is not deductible, either. For more on the intersection of mortgages and taxes, read 10 essential tax questions for homeowners.

Correct! Incorrect. The answer is: False.

A qualified mortgage (QM) is a mortgage that meets the standards set forth in the Dodd-Frank regulations. Among other things, these products aren't allowed to have risky features such as interest-only or balloon payments and have limits on debt-to-income ratios and fees. Non-QM loans can have these alternative features and others, but cannot be sold or backed by Fannie Mae or Freddie Mac.

Correct! Incorrect. The answer is: True.

Although the central bank did directly manipulate mortgage markets for a number of years, it didn't directly state what mortgage rates should be. Rather, it moved mortgage rates in the same way private investors do -- by buying up mortgage-backed securities and other mortgage-related debt. That six-year effort came to completion in 2014, was followed for a time by a reinvestment of inbound proceeds from those holdings, but even this minimal support ended back in 2017.