Finance
What is 'amortization' in the context of a Maine real estate mortgage?
AThe process of increasing loan payments over time
BThe gradual repayment of a loan through scheduled principal and interest payments✓ Correct
CThe penalty for paying off a loan early
DThe process of refinancing a mortgage
Explanation
Amortization is the process by which a mortgage loan is gradually repaid through regular scheduled payments that include both principal and interest, with the principal portion increasing and the interest portion decreasing over the loan term.
Related Maine Finance Questions
- A Maine buyer obtains a 30-year fixed mortgage for $240,000 at 6.5% annual interest. What is the approximate monthly interest charge for the first payment?
- What is the purpose of a 'title search' in a Maine real estate transaction?
- What is a 'balloon payment' in a Maine mortgage?
- Under the Equal Credit Opportunity Act (ECOA), a lender may NOT deny a loan based on:
- A Maine property with a purchase price of $400,000 and a 20% down payment is financed with a 30-year fixed mortgage at 7%. The loan amount is:
- A Maine borrower with an adjustable-rate mortgage (ARM) should be aware that their monthly payment may increase when:
- A Maine borrower has an adjustable-rate mortgage with a 2/6 cap structure and an initial rate of 5%. The maximum rate the loan can ever reach is:
- A Maine homebuyer applies for a conventional mortgage requiring PMI. PMI is typically required when the loan-to-value ratio exceeds:
Practice More Maine Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Maine Quiz →