Which of the following is true of a non-recourse mortgage?
A) The house buyer, if unable to make payments, can lose all possessions
B) The house buyer has an American style put option on the house
C) The house buyer has a European style put option on the house
D) The lender is less likely to lose money on the mortgage

Question

Quizplus · Accepted Answer

In a non-recourse mortgage, the borrower can walk away from the mortgage and surrender the property to the lender without owing anything further, similar to exercising an American style put option.

Which of the Following Is True of a Non-Recourse Mortgage