Fannie Mae Foundation: How to Buy a Home

Many teachers find the concept of percentages to be a difficult one for students to grasp. You, as a teacher, will have to decide if your students are ready for this lesson. In a mixed-level classroom, you may want to do the exercises in small groups, so the more advanced students can help the less advanced ones.

Start out by giving students a general idea of the concept by asking them to come up with things in their everyday lives that might be thought of in terms of percentages. Then look around the classroom for things that can be calculated using percentages, such as the percentage of students in the class who are women, the percentage of
people who drive to class (as opposed to taking the bus), and the percentage of class members who have children.

If your class is at a more basic level,you may want to save the lesson on changing percentages to decimals for a second class session. You may also want to consult commercial math workbooks for more ideas on how to explain percentages and decimals and for additional practice exercises.

In some classes, you might consider having a short math practice session on percentages every day throughout this unit. This is important because percentages are used in home buying. Look over Lesson 4 of this unit to become familiar with the kinds ofcalculations lenders make to decide if a buyer can qualify for a home. Students will need to work up to understanding this lesson.

Unit 1 : Lesson 1: This apartment is too small!

Working with numbers

In home buying, one of the most important math skills you will need is using percentages. We use percentages every day.

When the weather report tells us there is a 90 percent chance of snow, we may cancel a planned trip. When our favorite store has a 50 percent-off sale, we hurry in to get a good buy.

In home buying, the interest rate you pay on a loan is given as a percentage. The amount of money you put down when you buy a house is described by a percentage. Lenders will decide how much you can afford to spend on a house by looking at what percentage of your total income will go to housing costs.

Learn how to use percentages for the first time is not easy. Many students need a lot of practice to learn this skill well. This page contains only a very short lesson on how to read and write percentages. You may want to ask for more help from a teacher
or friend. Look for a math textbook that can give you more examples and practice activities using percentages.

All percentages start with a whole divided into 100 equal parts. Instead of writing the words “of 100,” we use the sign % and call it “percent.” So, if there is a 30 out of 100 chance of rain, we say there is a 30% chance of rain. One hundred percent (100%) is always equal to one whole thing. We see percentages used most often when it comes to money. One hundred cents is equal to one dollar. Five percent (5%) of a dollar is five cents.

Percentages are often described in a decimal form, especially when we are talking about money. To change a percentage to a decimal, you divide the number by 100. For example:

5/100 = .05 or 5 percent

Here are the steps for changing a percentage to a decimal:

1. Write the number, but do not write the percent sign.	50
2. Put a decimal point after the number.	50.
3. Move the decimal point two places to the left. (When you do this you are dividing by 100.)	.50
4. Read both numbers aloud the same way.	50% =.50

Now try changing the following percentages into decimals:

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