For the 504 Loan, the SBA Approves and Guarantees the Development

question 2

True/False

For the 504 loan, the SBA approves and guarantees the development company's portion of the debt but does not guaranteed the debt of the participating commercial bank.

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Definitions:

Amortized

The process of spreading out a loan into a series of fixed payments over time, which covers both the principal and the interest.

Compounded Monthly

Interest calculation strategy where interest is added to the principal sum every month, allowing the investment to grow at a faster pace.

Amortized

The process of gradually paying off debt through a series of fixed payments that include both interest and a portion of the principal.

Compounded Monthly

Refers to the process where interest is calculated and added to the principal sum every month, resulting in interest earning interest.