Which of the following statements about balloon payment mortgages is not true?
A) It is a traditional loan where interest is paid until the time when the principal is due.
B) Terms can be 3, 5 or 7 years.
C) Loan is amortized over 15 or 30 year period so that monthly payments are no different than an FRM of equal maturity.
D) Rate is variable over the contract term.
E) All of the above statements are true.
Correct Answer:
Verified
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