Communicating Mortgage Information: Tired of Paying Rent Your best friends, Nadia and Mark, are definitely tired of paying rent. One Sunday they saw an “Open House” sign and stopped to see the home that was for sale. They fell in love with the red brick home, but they quickly realized that purchasing a home required more cash and more knowledge than they had. They knew nothing about home mortgages. Because they think you are a whiz at computer searching, they ask you to help them get educated.
Using a search tool such as Google, locate Web sites with home mortgage tips. Sort through the commercial clutter until you find answers to these questions:
a. What are the advantages and disadvantages of the main types of mortgages?
b. What does a mortgage payment consist of? Explain PITI.
c. How much down payment will Nadia and Mark need?
d. What is prequalification?
e. What are some general tips for new home buyers seeking a mortgage? After collecting the information, think about the best way to present it to Nadia and Mark. How much do they already know about this subject? How detailed should you make your explanations? What channel of communication would be best? Will they want a written record? Be prepared to discuss your findings and analysis in class, in teams, or in a memo to your instructor.