Paul Is 23 Years Old and Has a Small Amount

question 63

Multiple Choice

Paul is 23 years old and has a small amount to use as a down payment for his first house.He might be eligible for a(n)

• A) ARM.
• B) FHA loan.
• C) Negative amortization.
• D) Payment cap.
• E) VA loan.

---

Definitions:

Coupon Rate

A bond's yearly interest payout rate, described as a percentage of its face value.

Coupon Rate

The annual interest rate paid on a bond's face value, indicating the amount of periodic payments to the bondholder.

TIPS Bond

Treasury Inflation-Protected Securities are U.S. government bonds that are indexed to inflation in order to protect investors from the negative effects of rising prices.

Par Value

The nominal or face value of a bond, share of stock, or coupon as stated by the issuer, which does not necessarily reflect its market value.