If a purchaser receives a 10% incentive of the home’s purchase price of $200,000, or $20,000 and their home value decreases to $150,000:Select one:a. they will still owe $20,000b. their debt will be reduced by 50%c. their repayment value will be 10% of the current value or $15,000.d. their debt will be erased
Question
If a purchaser receives a 10% incentive of the home’s purchase price of 20,000 and their home value decreases to 20,000b. their debt will be reduced by 50%c. their repayment value will be 10% of the current value or $15,000.d. their debt will be erased
Solution
The correct answer is c. their repayment value will be 10% of the current value or $15,000. This is because the incentive is based on the home's value. If the home's value decreases, so does the repayment value.
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