True or False 1. A PLAM mortgage reduces the lender’s interest rate risk (relative to a FRM). In general, an ARM has higher default risk than a FRM.

True or False

1. A PLAM mortgage reduces the lender’s interest rate risk (relative to a FRM).

2. In general, an ARM has higher default risk than a FRM.

3. Points are also known as reduction of mortgage yield.

4. A 5/1 ARM means that the mortgage is floating rate with an initial rate of 5%.

5. A mortgage with a balloon payment will have a lower pay rate than an otherwise identical fully amortizing mortgage.

6. Prepayment risk is the risk that the borrower will repay the debt prior to its scheduled maturity; this is likely to occur when the current mortgage rate is higher than the original rate.

7. APR is computed by the interest rate charged per period divided by the number of periods per year.

8. With a floating rate mortgage, the longer the payment adjustment period, the greater is the borrower’s interest rate risk.

9. For a 10-year $1 million mortgage with 6% interest rate, the accrual rate is 6%. 

Show more

Calculate Your Essay Price
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more

Order your essay today and save 10% with the coupon code: best10