Question

homework: section 8.7 homework
question 6, 8.7.13
hw score: 55%, 6.6 of 12 points
points: 0 of 1
what is a mortgage?
choose the correct answer below.
a. a mortgage is an account into which lending institutions often require a monthly payment in order to pay real estate taxes and insurance.
b. a mortgage is a one-time charge that equals 1% of the home loan amount.
c. a mortgage is the portion of the sale price of a home that the buyer initially pays to the seller.
d. a mortgage is a long-term installment loan for the purpose of buying a home.

Explanation:

• Option A describes an escrow account, not a mortgage.
• Option B refers to a loan origination point, not a mortgage.
• Option C describes a down payment, not a mortgage.
• Option D correctly defines a mortgage as a long-term loan for home purchase, repaid in installments.

Answer:

D. A mortgage is a long-term installment loan for the purpose of buying a home.