A loan arrangement in which there is no set number of payments. As the balance of the loan is reduced, the borrower can renew the amount of the loan up to a pre-approved credit limit is called a mortgage.

Question

A loan arrangement in which there is no set number of payments. As the balance of the loan is reduced, the borrower can renew the amount of the loan up to a pre-approved credit limit is called a mortgage.​

Quizplus · Accepted Answer

This description refers to a revolving loan or line of credit, not a mortgage. A mortgage is a loan specifically used to purchase real estate, with a set number of payments and terms.

A Loan Arrangement in Which There Is No Set Number