Finance
In New Mexico, which of the following is generally TRUE about prepayment penalties on residential mortgages?
AAll residential loans must include prepayment penalties
BMany residential loans, particularly QM (qualified mortgage) loans, do not have prepayment penalties, but some non-QM loans may✓ Correct
CPrepayment penalties are required by the NMREC
DPrepayment penalties only apply to commercial loans
Explanation
Qualified Mortgage (QM) loans under the Dodd-Frank Act generally cannot have prepayment penalties (with very limited exceptions). Non-QM and hard money loans may have prepayment penalties.
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