Asked by
Alexis Mousty
on Oct 31, 2024Verified
What was the advantage of subprime mortgages?
A) They were offered at low interest rates, but had to be paid down in 15 years.
B) Their rates were higher, but they were spread out over 30 years.
C) They offered small down payments and low rates that would increase later.
D) They had no down payment, but the interest rate would fluctuate monthly.
Subprime Mortgages
These are home loans granted to borrowers with lower credit ratings, implying higher risk for the lender and typically coming with higher interest rates.
Down Payments
A down payment is the initial, upfront portion of the total amount due, often associated with the purchase of expensive items like a home or a car, which is not financed through a loan.
Interest Rate
The percentage at which interest is paid by a borrower for the use of money that they borrow from a lender.
- Assess the monetary policies and economic scenarios that resulted in the Great Recession.
Verified Answer
KR
Learning Objectives
- Assess the monetary policies and economic scenarios that resulted in the Great Recession.