Finance
A wraparound mortgage is one where:
AThe new loan pays off the existing mortgage
BA new loan wraps around an existing mortgage that remains in place✓ Correct
CTwo mortgages are combined into one
DThe seller takes back a first mortgage
Explanation
A wraparound mortgage is a junior financing arrangement where the new (wrap) mortgage encompasses the existing senior mortgage. The seller collects payments from the buyer and continues making payments on the existing loan.
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