If properly constructed,and assuming everything but the structure of the interest payment is equal,which of the following loans would typically have the highest first-year debt service?
A)Accrual loan
B)Conventional loan
C)Interest only loan
D)Participation loan

Question

Quizplus · Accepted Answer

Conventional loans typically have the highest first-year debt service because they include both principal and interest payments from the start, unlike interest-only loans which only require interest payments initially, or accrual loans where interest might be added to the principal. Participation loans' payments can vary based on the agreement but don't inherently have the highest first-year debt service.

If Properly Constructed,and Assuming Everything but the Structure of the Interest