Finance
A mortgage with a large final payment that is much larger than the regular payments is called a:
AGraduated payment mortgage
BBalloon mortgage✓ Correct
CReverse mortgage
DInterest-only mortgage
Explanation
A balloon mortgage requires regular monthly payments (often based on a longer amortization) but the entire remaining balance becomes due in a large lump-sum balloon payment at the end of a shorter loan term.
People Also Study
Related Idaho Questions
- A mortgage has a remaining balance of $150,000 at 6% annual interest. The monthly payment is $1,100. How much of the first payment goes toward principal?Real Estate Math
- A property has a mortgage balance of $200,000 at 5.4% annual interest. The monthly payment is $1,200. How much of the first payment reduces the principal?Real Estate Math
- A mortgage that requires the borrower to pay only interest during the loan term with the full principal due at maturity is called a:Finance
- A mortgage has a balance of $180,000 at 6.5% annual interest. What is the monthly interest portion of the next payment?Real Estate Math
- A property has a $180,000 mortgage balance at 7.5% annual interest. What is the monthly interest portion of the first payment?Real Estate Math
- When a lender requires a borrower to maintain a certain amount in an escrow account for taxes and insurance, the monthly escrow payment is calculated by:Finance
- A conventional loan with less than 20% down payment typically requires:Finance
- A borrower's gross monthly income is $6,000. Their proposed mortgage payment is $1,500 and other monthly debts total $600. What is their back-end DTI ratio?Finance
Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Math Concepts
Study This Topic
Practice More Idaho Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Idaho Quiz →