Which of the Following Is Not True About Construction-To-Permanent Mortgages

question 18

Multiple Choice

Which of the following is not true about construction-to-permanent mortgages?

• A) Bridge financing is provided by lender over the time frame required by the borrower to purchase land and construct the house.
• B) Both interest and principal payments are made until construction is completed.
• C) Loan is financed in increments as construction payments have to be made.
• D) On completion of the construction, loan balance is rolled over into the type of mortgage contract desired by borrower.

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Definitions:

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A period of temporary economic decline during which trade and industrial activities are reduced, generally identified by a fall in GDP in two successive quarters.