Which One of the Following Is TRUE About Prepayment Penalties

question 27

Multiple Choice

Which one of the following is TRUE about prepayment penalties?

• A)They are never used with residential mortgages
• B)They lower the effective cost if the loan is repaid before maturity
• C)They are equivalent to charging additional points for the loan
• D)They are not included in the APR calculation

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Definitions:

Essentialism

The belief that entities have a set of immutable characteristics that define their essence, often applied to social categories like gender or race.

Group Dynamics

The study of the behaviors, interactions, and psychological processes that occur within and influence the actions of a group.

Therapy

A treatment intended to relieve or heal a disorder, often involving psychological techniques.

Storming

Describes a stage in group development where members express conflicting opinions, challenge group goals, and resist control by group leaders, often leading to tension.