Mortgage Insurance Covers a Lender in the Event of a Foreclosure

question 5

True/False

Mortgage insurance covers a lender in the event of a foreclosure if the value of the collateral is less than 80% of the amount of the outstanding debt.The borrower pays the premium on the mortgage insurance.

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Definitions:

Percentage

A ratio expressed as a fraction of 100.

Divisional Operating Income

Divisional operating income refers to the profit generated from the operations of a specific division within a company, excluding expenses and incomes that are not directly related to the division's operations.

Proportional Allocation

A method of distributing costs, resources, or revenues among various accounts or projects based on a predetermined criterion, such as usage or benefit.

Residual Income

The amount of income that an individual or business has after all expenses and debts have been paid.