Question

What is one difference between fixed-rate mortgages and variable-rate mortgages?

A. The borrower can adjust monthly payment depending on his budget.
B. The interest rate may change depending on the condition of the economy.
C. The lender can adjust the monthly payment dates whenever he wants to.

Answer 1

The correct answer should be B. The interest rate may change depending on the condition of the economy.

Fixed-rate mortgages keep the same rates as they were declared at the time of the contract signing, which can either be great for the person or the bank depending on the economy fluctuations. Variable-rate mortgages change based on the economy which means that the conditions are always kept to a certain standard.