which of the following statements is true? a. a 30 year fixed mortgage will always result in the lowest…
which of the following statements is true? a. a 30 year fixed mortgage will always result in the lowest payment. b. you must have at least a 20% down payment to get a competitive interest rate. c. the lower your interest rate is, the lower your monthly payments are. d. the faster you pay off your mortgage, the lower your monthly payments are. please select the best answer from the choices provided
Answer
Brief Explanations:
- Option a: A 30 - year fixed mortgage may not always result in the lowest payment as other mortgage terms and interest rate scenarios could be more favorable.
- Option b: It is not always necessary to have a 20% down - payment to get a competitive interest rate. Some lenders offer good rates with lower down - payments.
- Option c: The monthly mortgage payment formula includes the interest rate. A lower interest rate means less interest is charged each month, resulting in lower monthly payments.
- Option d: The faster you pay off your mortgage (shorter loan term), the higher your monthly payments are likely to be as you are spreading the principal over fewer months.
Answer:
C. The lower your interest rate is, the lower your monthly payments are.