Question 18 (2.4 points)

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All of the following are common characteristics of sub-prime mortgages except:

Question 18 options:

	lack of income documentation
	unmarried borrowers
	seeking LTV of 100%
	low credit scores

Question 19 (2.4 points)

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The secondary mortgage market:

Question 19 options:

	is called secondary because it is less important than the primary mortgage market
	is where an investor goes after the primary mortgage market has turned down his request for a loan
	increases mortgage liquidity risk due to its inefficiency
	purchases and sells mortgages that have been previously originated by other lenders in the primary market

Question 20 (2.4 points)

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The interest rates on fixed rate mortgages are usually higher than adjustable rate mortgages because:

Question 20 options:

	Lenders bear high interest rate risks
	Borrowers of fixed rate mortgages always have low FICO scores
	Loan amounts of fixed rate mortgages are high (> $400,000)
	All of the above