Finance
A balloon mortgage in Vermont requires the borrower to:
AMake increasing payments over the loan term
BPay a lump sum (the remaining principal balance) at the end of a shorter loan term✓ Correct
CPay interest only with no balloon
DPay principal only in the final year
Explanation
A balloon mortgage has a large lump-sum payment (the remaining principal balance) due at the end of the loan term, which is shorter than the amortization period. Borrowers typically must refinance or sell before the balloon payment is due.
Related Vermont Finance Questions
- A mortgage in Vermont creates which type of interest in the property for the lender?
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- Vermont's usury laws establish:
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