Question
1) When analyzing a fixed rate residential mortgage with fixed monthly payments over a period of 30 years, when would you expect to see the
1) When analyzing a fixed rate residential mortgage with fixed monthly payments over a period of 30 years, when would you expect to see the highest amount of interest payments, relative to principal payments?
Month 1 (1st payment)
Month 180 (Midpoint of payment schedule)
Month 360 (final payment)
It will remain the same through all payments
2) Which statement is true about commercial mortgages? Please mark all that apply
More money is invested in commercial mortgages than in residential mortgages.
Commercial mortgages are less risky and generally more conservative than residential mortgages.
Commercial mortgages are also issued without any real estate as collateral.
Commercial mortgages tend to mature earlier than residential mortgages.
Commercial mortgages are generally issued directly by the federal government.
3) In reality, borrowers often encounter additional mortgage costs beyond those that directly contribute to the lender's yield.
True
False
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