Finance
An Iowa buyer wants to compare a 15-year mortgage to a 30-year mortgage on the same loan amount. Which statement is TRUE?
AThe 30-year mortgage has lower monthly payments but significantly more total interest paid✓ Correct
BThe 15-year mortgage has higher total interest cost
CBoth have the same total interest cost
DThe 30-year mortgage builds equity faster
Explanation
A 30-year mortgage has lower monthly payments than a 15-year mortgage but results in significantly more total interest paid over the life of the loan. The 15-year mortgage builds equity faster.
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