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Questions and Answers
What is the prepayment penalty for a 30-year fixed mortgage if paid off within the first 5 years?
What is the prepayment penalty for a 30-year fixed mortgage if paid off within the first 5 years?
- 5% penalty of the remaining loan balance (correct)
- 1% penalty of the remaining loan balance
- 3% penalty of the remaining loan balance
- 7% penalty of the remaining loan balance
Which type of mortgage has the 5-year stepdown prepayment penalty?
Which type of mortgage has the 5-year stepdown prepayment penalty?
- 7/6 ARM only
- Both 30-year fixed and ARM mortgages (correct)
- 5/6 ARM only
- 30-year fixed only
What is the prepayment penalty for investment properties if the amount prepaid exceeds 20% of the original principal balance?
What is the prepayment penalty for investment properties if the amount prepaid exceeds 20% of the original principal balance?
- 1 month interest on the amount prepaid
- 6 months interest on the amount prepaid (correct)
- No prepayment penalty required
- 3 months interest on the amount prepaid
