Finance
Under California law, what is the maximum prepayment penalty period allowed on a conventional first mortgage secured by owner-occupied residential property of 1-4 units?
A1 year
B3 years
C5 years✓ Correct
D7 years
Explanation
California Civil Code limits prepayment penalties on owner-occupied 1-4 unit residential first loans to a maximum of five years. After five years, no prepayment penalty may be charged.
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