American_Bankers_Association
CTFA · Question #229
CTFA Question #229: Real Exam Question with Answer & Explanation
The correct answer is A. Negative amortization. See the full explanation below for the reasoning.
Question
It occurs when a principal balance on a mortgage loan increases because the monthly loan payment is lower than the amount of monthly interest being charged. What is it?
Options
- ANegative amortization
- BPositive amortization
- CAmortization imbalance
- DPayment gap
Community Discussion
No community discussion yet for this question.