Which of the following is true concerning an assumable mortgage?
A)The aggregate percent of the mortgage pool that has been prepaid prior to the month under consideration.
B)The mortgage contract is transferred from the seller to the buyer of a house.
C)The required interest spread of a pass-through security over a treasury when prepayment risk is taken into account.
D)A mortgage-backed bond issued in multiple classes or tranches.
E)Bonds collateralized by a pool of assets.

Question

Quizplus · Accepted Answer

An assumable mortgage is a mortgage contract that can be transferred from the seller to the buyer of a house. The buyer takes over the seller's mortgage loan and assumes responsibility for making payments on the loan. This type of mortgage can be beneficial to both the buyer and the seller as it can offer flexibility in financing arrangements. The other options listed describe different concepts related to mortgages and mortgage-backed securities, but not specifically to assumable mortgages.

Which of the Following Is True Concerning an Assumable Mortgage