### In a shared-equity transaction, who primarily takes responsibility for mortgage payments, property taxes, insurance, and routine maintenance? - [ ] The investor - [x] The resident - [ ] Both equally - [ ] The financial institution > **Explanation:** In a shared-equity transaction, the resident who occupies the property is responsible for the mortgage payments, property taxes, insurance, and routine maintenance. ### What happens to the profits from a shared-equity property when it is sold? - [ ] They belong entirely to the resident - [x] They are split between the owners based on predetermined percentages - [ ] They go to the financial institution - [ ] They are used to pay off taxes > **Explanation:** When a shared-equity property is sold, the profits are divided between the owners according to the predetermined ownership percentages agreed upon at the beginning of the agreement. ### Which of the following costs might be shared between the resident and the investor in a shared-equity transaction? - [x] Major repairs and improvements - [ ] Routine maintenance - [ ] Property taxes - [ ] Mortgage payments > **Explanation:** Under some shared-equity agreements, major repairs and improvements might be shared between both the resident and the investor, while routine maintenance is typically the responsibility of the resident. ### In a shared-equity transaction, what primary benefit does the resident obtain? - [ ] They gain full ownership of the property upfront - [x] They can occupy the property while sharing investment responsibilities - [ ] They receive higher loan interest rates - [ ] They are exempt from paying property taxes > **Explanation:** The primary benefit for a resident in a shared-equity transaction is that they can occupy the property while sharing the investment responsibilities, such as the initial down payment and mortgage qualification, with an investor. ### Why might an investor choose to enter a shared-equity transaction? - [x] To invest in real estate without the need to live in the property - [ ] To fully control the property and its maintenance - [ ] To gain tax exemptions - [ ] To avoid any kind of financial risk > **Explanation:** An investor might choose to enter a shared-equity transaction to invest in real estate and gain a portion of potential profits without having to live in or maintain the property. This arrangement allows the investor to be part of the real estate market passively. ### What option does the new party have after a specified time frame in a shared-equity transaction? - [ ] They can continue renting indefinitely - [x] They could buy themselves out of the agreement - [ ] They are required to move out - [ ] The investor must take over all payments > **Explanation:** After a specified time frame in a shared-equity transaction, the new party has the option to buy themselves out of the arrangement, allowing them to assume full ownership of the property if they choose. ### In a shared-equity transaction, what initial financial commitment might the new party contribute? - [x] Down payment and new mortgage - [ ] Insurance payments only - [ ] Routine maintenance fees only - [ ] Property tax exemption fees > **Explanation:** In a shared-equity transaction, the new party often contributes financially through a down payment and taking on a new mortgage, facilitating their role as part-owner and occupant of the property. ### What is shared-equity transaction primarily designed for? - [x] Shared ownership of property between two parties - [ ] Transferring full property ownership immediately - [ ] Eliminating all maintenance costs for occupants - [ ] Reducing property tax assessments > **Explanation:** A shared-equity transaction is designed for shared ownership of property between two parties, typically involving one party as the resident responsible for most ongoing costs and another as the investor. ### Which of the following statements about shared-equity transactions is true? - [ ] The investor must also live in the property - [x] Ownership percentages are agreed upon by both parties - [ ] The resident cannot ever gain full ownership - [ ] The resident's responsibilities are minimal > **Explanation:** In shared-equity transactions, the ownership percentages of the property are mutually agreed upon by both the resident and the investor at the beginning of the agreement. ### What can an investor expect from entering a shared-equity transaction? -**[x] A share of the profits when the property is sold - [ ] Full responsibility for property maintenance - [ ] Total control over the living arrangements - [ ] Completely tax-free revenue > **Explanation:** An investor in a shared-equity transaction can expect to receive a share of the profits when the property is sold, as per the predetermined ownership agreement. They typically do not bear full maintenance responsibility or enjoy completely tax-free revenue.