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Question 3 of 10
Which of the following is a disadvantage to refinancing?
O A. Prepayment penalties
B. Lower interest rates
O C. Locked rates
D. Lower monthly payments

Sagot :

Samawatiidn

Answer:

A. Prepayment penalties

Explanation:

Refinancing a loan has the benefits of a lower interest rate, which results in some cost-saving. However, when seeking to refinance, there cost that have to be incurred. The customer has to apply for refinancing, which attracts an application fee. The customer is also required to pay closing costs for the previous loan.

Lower interest rates, Locked rates, and Lower monthly payments are advantages of refinancing.

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