Which of the following is true?
A)In 2007, the default rate on fixed rate mortgages was lower than that on ARMs.
B)From 2006-2008, housing construction decreased in the U.S.
C)Zero-down mortgages decreased the incentive for homeowners to prevent defaulting on their homes.
D)all of the above

Question

Which of the following is true?
A)​In 2007, the default rate on fixed rate mortgages was lower than that on ARMs.
B)​From 2006-2008, housing construction decreased in the U.S.
C)​Zero-down mortgages decreased the incentive for homeowners to prevent defaulting on their homes.
D)​all of the above

Quizplus · Accepted Answer

All statements are true. In 2007, the default rate on fixed-rate mortgages was indeed lower than that on Adjustable Rate Mortgages (ARMs), reflecting the higher risk associated with ARMs when interest rates rise. From 2006 to 2008, the U.S. experienced a significant decrease in housing construction as part of the housing market downturn. Zero-down mortgages, by offering homeownership with no initial equity, reduced the financial loss homeowners would face from defaulting, thereby decreasing the incentive to avoid default.

Which of the Following Is True