Statement i when a bank requires a borrower to pay a large


Review the statements below:

Statement I: When a Bank requires a Borrower to pay a large downpayment on the purchase of a house, the Bank is reducing its risk by increasing the equity cushion to support any losses in value to the collateral.

Statement II: When a Bank requires a Borrower to pay a large downpayment on the purchase of a house, the Borrower's risk is reduced because the monthly payment will be lower, making the home more affordable.

Statement III: When a Bank requires a Borrower to pay a large downpayment on the purchase of a house, the Seller of the house is seeing less risk due to the terms of the mortgage loan.

a. Statements I and II are the only correct statements

b. Statements I and III are the only correct statements

c. Only Statement I is correct

d. Only Statement II is correct

e. Statements II and III are the only correct statements

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Finance Basics: Statement i when a bank requires a borrower to pay a large
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