When Mark and Valerie Bowman first saw the house, they
didn’t like it. However, it was a dark, rainy day. They viewed
the house more favorably on their second visit, which they had
expected to be a waste of time. Despite cracked ceilings, the
need for a paint job, and a kitchen built in the 1960s, the Bowmans
saw a potential to create a place they could call their own.
Beth Franklin purchased her condominium four years ago.
She obtained a mortgage rate of 8.25 percent, a very good rate
then. Recently, when interest rates dropped, Beth was considering
refinancing her mortgage at a lower rate.
Matt and Peggy Zoran had been married for five years and
were still living in an apartment. Several of the Zorans’ friends
had purchased homes recently. However, Matt and Peggy were
not sure they wanted to follow this example. Although they
liked their friends’ homes and had viewed photographs of
homes currently on the market, they also liked the freedom from
maintenance responsibility they enjoyed as renters.
Questions
How could the Bowmans benefit from buying a home that needed improvements?
How might Beth Franklin have found out when mortgage rates were at a level that would make refinancing her condominium more affordable?
Although the Zorans had good reasons for continuing to rent, what factors might make it desirable for an individual or a family to buy a home?
