Question

1. a conventional mortgage usually involves

a) a variable interest rate.
b) a government guarantee.
c) a balloon payment.
d) equal payments.

Explanation:

To solve this, we analyze each option:

• Option A: Conventional mortgages typically have fixed interest rates, not variable, so A is incorrect.
• Option B: Government guarantee is for government - backed mortgages (like FHA, VA), not conventional, so B is incorrect.
• Option C: Balloon payments are not typical of conventional mortgages which usually have amortizing payments (equal payments over time to pay off principal and interest), so C is incorrect.
• Option D: Conventional mortgages usually have equal monthly payments that include principal and interest, amortizing the loan over time.

Answer:

D. equal payments.