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To review the differences in the characteristics of different types of mortgage loans, match the types of mortgages and related programs listed on the left

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To review the differences in the characteristics of different types of mortgage loans, match the types of mortgages and related programs listed on the left with their descriptions on the right. Read each description carefully and type the letter of the description in the Answer column next to the correct term These are not necessarily complete definitions, but there is only one possible answer for each term. Term Description Fixed-rate mortgage Answer O Interest-only mortgage I B. VA loan guarantee Biweekly mortgage D. TWO-step ARM The payments on this mortgage are equal to one-half of a regular monthly payment and are paid every two weeks rather than once a month. The lender in this type of mortgage assumes all of the risk of loss, including that caused by borrower default. This loan program, offered through a department of the federal government, provides mortgage insurance to lenders offering mortgage loans with loan-to-value ratios greater than 80% This loan guarantee is offered by a department of the federal government to lenders who make qualified loans to eligible veterans of the U.S. Armed Forces and their surviving spouses. This mortgage provides for two interest rates: one that is charged for the first five to seven years and a higher rate that is charged during the remaining term of the loan. Over the life of this mortgage, the Interest rate and the monthly payment can be adjusted based on changes in a market interest rate. This mortgage allows the borrower to pay only the accrued interest on the loan for a specified period of time; after this date, all payments require the payment of both interest and principal This mortgage provides a borrower with the flexibility to switch from an adjustable interest rate to a fixed rate, usually during the second to fifth year of the loan. This mortgage is characterized by a constant Interest rate and constant monthly payments over the life of the loan. Adjustable-rate mortgage Convertible ARM Graduated-payment ARM H . FHA mortgage Insurance Conventional mortgage ). This mortoage allows borrowers to make smaller-but gradually and constantly Increasing--payments for the first three to five years. At the end of this period, the payments then stabilite at the higher level and are repaid over the remaining life of the loan

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