American_Bankers_Association
CTFA · Question #202
An insurance policy that protects the mortgage lender from loss in the event the borrower defaults on the loan; typically required by lenders when the down payment is less than 20%.
The correct answer is A. Private mortgage insurance. See the full explanation below for the reasoning.
Fiduciary and Trust Activities
Question
An insurance policy that protects the mortgage lender from loss in the event the borrower defaults on the loan; typically required by lenders when the down payment is less than 20%.
Options
- APrivate mortgage insurance
- BPublic mortgage insurance
- CDown payment
- DLoan to value ratio
How the community answered
(23 responses)- A74% (17)
- B13% (3)
- C9% (2)
- D4% (1)
Topics
#private mortgage insurance#mortgage default#down payment#lender protection
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