An Annuity Is a Contract That Makes Monthly Payments as Long

question 77

Essay

An annuity is a contract that makes monthly payments as long as someone lives. Explain why an individual would want to purchase such a contract. What risk is being transferred?

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Definitions:

UCC

The Uniform Commercial Code encompasses a wide-ranging assortment of laws that control the entirety of commercial transactions within the United States.

Real Estate Mortgages

Real Estate Mortgages are legal agreements in which a borrower pledges real property to a lender as security for a loan, with the condition that the conveyance of title becomes void upon payment.

Trust Deeds

Legal documents that signify an agreement where property is held by a trustee as security for a loan until the borrower pays back the loan in full.

Security Interests

A legal claim or right granted over an asset to secure the performance of an obligation, typically the repayment of a loan.