Under Which Conditions Would One Be MOST LIKELY to See

question 20

Multiple Choice

Under which conditions would one be MOST LIKELY to see an interest rate swap?

• A)A borrower wants a fixed rate loan,but the bank only offers floating rate loans; the borrower "swaps" loans with someone who has a fixed rate loan
• B)A borrower does not have enough equity for a conforming loan,so he or she takes out a "second" mortgage loan
• C)A borrower does not have enough equity for a conforming loan,so he or she "swaps" mortgage insurance for increased equity investment
• D)A bankruptcy court orders a lender to "swap" a debtor's high interest rate for a lower interest rate

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Definitions:

Premarital Cohabitation

A living arrangement in which a couple tests its relationship before getting married.

Trial Marriage Cohabitation

The act of living together by a couple to test compatibility before committing to a formal marriage.

Substitute Marriage Cohabitation

A living arrangement in which a couple shares their lives in a manner similar to marriage, without being legally married, often involving sharing a household and financial responsibilities.

Dating Cohabitation

A living arrangement in which a dating couple lives together in the same household without being married.