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Mortgage Basics  Chapter 2: How mortgages work
You can get a mortgage in many places, but they all share the same characteristics.
 
   
How mortgages work
 

Mortgage Basics: Chapter 2 quiz

If you think you've mastered the material in this chapter, take our quiz. After you click the "submit" button, the answers will appear below.

  1. The principal of a fixed mortgage is paid off over time under a process called what?
    Principia.
    PITI.
    Amortization.
    Amore.

  2. Which of the following is NOT an advantage of taking out an adjustable-rate mortgage (ARM)?
    ARMs allow borrowers to take advantage of falling rates without refinancing.
    On certain ARMs, called negative amortization loans, borrowers can end up owing more money than they did at closing.
    ARMs offer a cheap way, for borrowers who don't plan on living in one place for very long, to buy a house.

  3. If you're self-employed and don't want to share a lot of information about your income, which type of lender is your best bet?
    A mortgage broker.
    A mortgage banker.
    A home builder.

-- Posted: May 1, 2006
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Mortgages
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NATIONAL OVERNIGHT AVERAGES
30 yr fixed mtg 4.32%
15 yr fixed mtg 3.36%
5/1 ARM 3.37%
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