Finance
A Virginia mortgage loan with a 'negative amortization' feature allows:
AThe borrower to pay more than required to pay off faster
BThe unpaid interest to be added to the principal balance, causing the balance to grow✓ Correct
CThe interest rate to decrease over time
DThe borrower to skip payments entirely
Explanation
Negative amortization occurs when minimum payments are less than the monthly interest accrued. The unpaid interest capitalizes (adds to the principal), causing the loan balance to grow rather than decrease.
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