As Used in the Context of a Mortgage, a "Prepayment

question 2

Multiple Choice

As used in the context of a mortgage, a "prepayment privilege"

• A)means that the lender can demand repayment of the loan sooner than expected.
• B)means that if the borrower misses a payment on the loan, the entire amount becomes due immediately.
• C)is used to allow certain payments to be made without penalty.
• D)arises in connection with an insurance contract.
• E)is prohibited in many Canadian provinces.

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Definitions:

Accounts Payable

Represents a company's obligation to pay off a short-term debt to its creditors or suppliers.

Accounts Receivable

Money owed to a company by its customers for goods or services that have been delivered but not yet paid for.