Most Americans are confident with in their knowledge of the mortgage industry, but a new study found that nearly half don’t know what they’re talking about. Zillow Mortgage Marketplace released the results from a survey the firm recently conducted in conjunction with lpsos, an independent research firm. The survey tested prospective homebuyers’ knowledge of the industry with true or false questions. About 77% of prospective homebuyers did not clearly understand what factors are involved in determining a mortgage interest rate, claiming that annual income is an important determinant. The main factors include loan-to-value-ratio, credit score and debt-to-income ratio. Interest rates gave survey respondents trouble across the board, as 57% believed interest rates on 5-year adjustable-rate mortgages would always increase after the five years, and 55% said that mortgage rates were set once everyday. Nearly one-third of prospective homebuyers did not know that lender fees were negotiable  and vary by lender, Zillow said, suggesting “many buyers aren’t shopping around and getting the best possible terms.” Approximately 42% of survey respondents thought loans from the Federal Housing Administration were for first-time homebuyers only, while 37% considered a pre-qualification a binding commitment from a bank. The survey is still available online as a quiz. Test your knowledge here. Write to Christine Ricciardi. Follow her on Twitter @HWnewbieCR.