A Borrower Who Has Failed to Make a Payment of Principal

question 21

True/False

A borrower who has failed to make a payment of principal or interest when due or meet any other requirement of a credit agreement is said to be in foreclosure.

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Definitions:

Compounded Annually

Interest calculation on a loan or investment once per year where each year's interest is added to the principal.

Rate of Return

The increase or decrease in the value of an investment over a certain time frame, represented as a percentage of the investment's original price.

Compound Annual Return

The annualized average percentage rate of return that accounts for the compounding of interest over a period of time.

Diversified Equity Mutual Fund

A mutual fund that invests in a wide range of equities from various sectors to reduce investment risk.