The Center for
Mathematics and Quantitative Education at Dartmouth

Money Matters
The Financial Literacy Initiative at Dartmouth College

Buy, Rent, or Live in a Tent?
Mortgages and House Purchase

The U.S. Census Bureau reported (2009) that about 67% of all housing units in the U.S. were owner occupied. Home ownership is a recognized part of the American Dream, and is subsidized through by the government through mortgage loans and tax deductions. An impressive 93% of married couples between 70 and 74 owned their houses. Almost everybody eventually purchases a house.

But the decision to do so must be made carefully. For most people, their house will be the biggest purchase ever made and the largest loan ever taken. The Federal Reserve Bank of NY reports (as of this writing) about 5% of homeowners more than 90 days delinquent on mortgage payments and therefore in danger of foreclosure.

In this module we explore the process of financing and purchasing a home so that students understand the expectations of mortgage lenders and the impact that owning a house has on a budget.

We suggest that instructors open the instructor notes for this module, save them as a PDF file, and print them for reference.

This module also includes assessment tools (pre and post test) and a case study for deeper investigation of this topic. These resources are available by contacting Audrey Brown .

Dorothy Wallace, Dartmouth College, Kim Rheinlander, Dartmouth College, Semra Kilic-Bahi, Colby Sawyer College, Andrew Cahoon, Colby Sawyer College, Caren Diefenderfer, Hollins University