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Joshua and Tammy just purchased property with an ARM mortgage. What is true?

There is collateral.
They have a non-secured loan.
Their interest will be fixed.
They cannot make a down payment.

Respuesta :

Answer:

There is collateral.

Explanation:

  • The house is the collateral for the mortgage
  • If there, there collateral then it's a secured laod
  • ARM = Adjustable Rate Mortage.  Interest rate can change over the life of the laod
  • ARM is a mortage and almost every mortage requires a down payment.
chilljain33

In a condition when Joshua and Tammy just purchased property with an ARM mortgage, then there is a collateral. Therefore, the option A holds true.

What is the significance of a collateral?

A collateral on a mortgage or a loan can be referred to or considered as a securitization of assets in the hands of the lender in order to get the amount of loan desired by the customer. A mortgage is necessarily accepted only when there is a collateral for the lender's security.

In the above condition, Joshua and Tammy have opted for an ARM mortgage. As a result, there will be a requirement of collateral for the lender who has lent them the amount for purchasing a property jointly.

Therefore, the option A holds true regarding the significance of a collateral.

Learn more about a collateral here:

https://brainly.com/question/6779619

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