F1. Real Estate – What is Mortgage and How to Borrow From the Bank



Specific Expectations

By the end of the program, students will:


Real Estate Concepts

F1.5 Explain the concept of mortgages as loans used to purchase real estate, and how they involve paying back the borrowed money over time.

Tie into existing Ontario Curriculum: E.G. Grade 7 – Explain how interest rates can impact savings, investments, and the cost of borrowing to pay for goods and services over time

Teacher supports:

  • Utilize the Monopoly Game as a simulation tool to explain the concept of mortgages and borrowing from the bank.
  • Discuss the responsibilities of repaying loans, both in the game and in real-life scenarios.

Examples:

  • Mortgages:
    • Definition: Mortgages are loans obtained to purchase real estate, with the property serving as collateral.
    • Repayment: Borrowers pay back the borrowed money over an agreed-upon period, including interest.
  • Monopoly Game Simulation:
    • Borrowing from the Bank: In the game, simulate the process of borrowing money from the bank to acquire properties.
    • Repayment Responsibilities: Discuss the obligations of repaying loans in the game, mirroring real-life financial responsibilities.

Key concepts:

  • Mortgages are financial instruments used to facilitate the purchase of real estate through loans.
  • Repayment of mortgages involves paying back the borrowed money along with interest over a specified period.

Note:

Understanding the concept of mortgages and borrowing is integral to the Monopoly Game program, where students experience the financial aspects of property acquisition and loan management.

Sample tasks:

  • In the Monopoly Game, guide students through the process of borrowing from the bank to acquire properties. Discuss the terms of the loan and the impact of interest on repayment.
  • Facilitate a discussion on the responsibilities of repaying loans, drawing parallels between the game and real-life scenarios. Explore the long-term financial implications of borrowing in both contexts.

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