Asked by Mathu Vicky on Jul 23, 2024
Verified
A balloon-payment mortgage is a type of loan that allows older homeowners to convert some of the equity in their home into cash,while retaining ownership of their home.
Balloon-Payment Mortgage
A mortgage that has relatively low fixed payments during the life of the mortgage followed by one large final (balloon) payment.
Equity
Fairness or justice as applied in the correction of law or the ownership interest in a company or property.
- Master the essential fundamentals of various types of mortgages and their respective traits.
- Acquire insight into the effects of distinctive characteristics of loans like fluctuating rates, end-term large payments, and federal guarantees.
Verified Answer
KP
Keeley ParkerJul 26, 2024
Final Answer :
False
Explanation :
A balloon-payment mortgage is a loan that typically offers low initial payments with a large payment due at the end of the loan term. It does not involve converting home equity into cash while retaining home ownership; that describes a reverse mortgage.
Learning Objectives
- Master the essential fundamentals of various types of mortgages and their respective traits.
- Acquire insight into the effects of distinctive characteristics of loans like fluctuating rates, end-term large payments, and federal guarantees.
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