Finance
In Minnesota, which type of mortgage requires the borrower to pay interest only for a specified period, after which they begin paying principal and interest?
AFixed-rate fully amortized mortgage
BInterest-only mortgage✓ Correct
CReverse mortgage
DBalloon mortgage
Explanation
An interest-only mortgage requires only interest payments for a specified period (typically 5-10 years). After the interest-only period, the loan resets to fully amortizing P&I payments. This results in higher payments after the reset and slower equity building during the interest-only phase.
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