Janet is considering the purchase of a condo for $150,000 during a recession phase, partly financed by a mortgage. She is due to retire in a few years. If she cannot make her mortgage payments on time, she is bound to incur a:
A) neutral equity on her property.
B) reduced residual value of the property.
C) loan-to-value ratio .
D) foreclosure of her house.
E) fine from the local government.

Question

Quizplus · Accepted Answer

If Janet cannot make her mortgage payments on time, she is at risk of foreclosure, which means the lender could take possession of her condo and sell it to recover their money. This would result in Janet losing her property and potentially damaging her credit score.

Janet Is Considering the Purchase of a Condo for $150,000