Buy A House Project
Description: Students are to pick a house for a family of 4 to live at age 35. The house has to
be currently on the market and pick the house you could see your future family living in. Make
sure that your house is relative to the amount of money you predict you will make (3x’s your
income… if you make $100,000 you can afford $300,000). You will compare the house with
good and bad credit, different down payments and different lengths of credit. The more
expensive the house the larger the payment for you and your family. Use mortgage calculator
below. I recommend picking a house in your area so that you understand the housing market
but it is not mandatory.
Resources:
National Relators Websites:
http://www.remax.com/
https://www.coldwellbanker.com/
http://www.russellrealty.com/
Local Relators (Google Search your area)
http://www.hoty.com/real-estate/residential/
Current Interest Rates (just google if needed)
Wells Fargo: https://www.wellsfargo.com/mortgage/rates/
Mortgage Calculators (just google if needed):
http://www.mortgagecalculator.org/
Address of Home you bought: ___________________________________________________
Why did you choose this house? What are the positives of the house?
House Mortgage #1 Comparison of 30 and 15-year loan with 10% Down
Directions: Search Home loans interest rates and assume you have excellent credit.
a. List/Purchase Price: ________________________________________________
b. Down payment 10% (a x .10): ______________________________________________
Option #1 30 Year Fixed Rate
1. Mortgage/Loan Amount (Subtract a-b): ___________________________________
2. Interest Rate 30 Year Fixed Rate (use interest rate): ____________________________
3. Monthly Payment: __________________________________
4. Total Interest Paid (360 months): __________________________________
5. Total Payment (over 360 months): Total Principal + total Interest: ______________
6. Total Property Tax Paid: _____________________________
7. Total Home Insurance Paid ($1,000 x 30) : ___________________________
Option #2 (15 Year Fixed Rate)
1. Mortgage/Loan Amount (Subtract a-b): ___________________________________
2. Interest Rate 15 Year Fixed Rate (use interest rate): ____________________________
3. Monthly Payment: __________________________________
4. Total Interest Paid: __________________________________
5. Total Payment (over 360 months): Principal + Interest: _________________________
6. Total Property Tax Paid: _____________________________
7. Total Home Insurance Paid ($1,000 x 30) : ___________________________
Mortgage #2- Good vs. Bad Credit Comparison with 30 and 15-year loan
Directions: Student will use the same loan for 10% down but will add 2.5% to the loan rate to
Mortgage to represent the banks rate for poor credit.
a. List/Purchase Price: ________________________________________________
b. Down payment 10% (a x .10) ________________________________________________
Option #1 30 Year Fixed Rate
1. Mortgage/Loan Amount (Subtract a-b): _______________________
2. Interest Rate 30 Year Fixed Rate (use current interest rates and add 2.5%):
____________________________
3. Monthly Payment: __________________________________
4. Total Interest Paid: __________________________________
5. Total Payment (over 360 months): Principal + Interest: _________________________
6. Total Property Tax Paid: _____________________________
7. Total Home Insurance Paid ($1,000 x 30) : ___________________________
Option #2 (15 Year Fixed Rate)
1. Mortgage/Loan Amount (Subtract a-b): ___________________________________
2. Interest Rate 15 Year Fixed Rate (use current interest rate and add 2.5%):
____________________________
3. Monthly Payment: __________________________________
4. Total Interest Paid: __________________________________
5. Total Payment (over 360 months): Principal + Interest: _________________________
6. Total Property Tax Paid: _____________________________
7. Total Home Insurance Paid ($1,000 x 30) : ___________________________
Mortgage #3 - 20% Down Payment with 30 to 15-year loan
Explanation: 20 % Down with excellent credit (use same interest rate as Mortgage #1). This
mortgage will compare the difference of 10 and 20% down payments.
List/Purchase Price: ________________________________________________
Down payment 20%: (a x .20) _______________________________________________
Option #1 30 Year Fixed Rate

Mortgage/Loan Amount (Subtract a-b): _______________________

Interest Rate 30 Year Fixed Rate (use current interest rate):
____________________________

Monthly Payment: __________________________________

Total Interest Paid: __________________________________

Total Payment (over 360 months): Principal + Interest: _________________________

Total Property Tax Paid: _____________________________

Total Home Insurance Paid ($1,000 x 30) : ___________________________
Option #2 (15 Year Fixed Rate)
8. Mortgage/Loan Amount (Subtract a-b): ___________________________________
9. Interest Rate 15 Year Fixed Rate (use current interest rate):
____________________________
10. Monthly Payment: __________________________________
11. Total Interest Paid: __________________________________
12. Total Payment (over 360 months): Principal + Interest: _________________________
13. Total Property Tax Paid: _____________________________
14. Total Home Insurance Paid ($1,000 x 30) : ___________________________
Post House Comparison Questions
1. Mortgage #1 Analysis Question:
a. In a paragraph, compare and contrast the 2 length of loan options. Describe the
differences in interest and total payments between the two loans.
b. Describe to a first time homebuyer, what are the positives and negatives of a 30year loan compared to a 15-year loan at the same rate?
2. Compare Mortgage 1 to Mortgage 2 for the 30-year loan.
a. How does having bad credit effect your monthly payment for your house?
b. How much more money do you spend in total interest paid when you have bad
credit over the course of the loan?
c. Describe to an 18-year-old who is starting to establish credit, why they need to
make sure they maintain good credit for when they buy a house.
3. Compare Mortgage 1 to Mortgage 3 for the 30-year loan
a. How does changing the down payment change the monthly payment for your
house?
b. How much money do you save by putting more money down on your home over
the course of the loan.
4. Comparing the 3 mortgage options
a. Explain to a first time homebuyer they should understand about length of
mortgages, down payments, effect of bad credit, taxes and interest rates?
Optional Assignment
1. Have students create a presentation to the class (or visual) and explain their house to
the class.
a. Describe what options you will use.
b. Describe payment prices to the class based on the 3 mortgages
Teaching Recommendation:
1. Recommend downloading Buy a House PowerPoint and Note Sheet by same seller or
Buy a House Unit.
2. Project is better with background knowledge of home buying and mortgage and/or
loans.