alleryStart learning →Why is credit card debt called a nonamortizing loan?
APrincipal repayment is not scheduled
BIt carries no interest at all
CIt has a single bullet date
DIt is secured by a house
Answer & Solution
Correct answer: A. Principal repayment is not scheduled
Cardholders repay as they choose above minimums, so there is no actual maturity date or fixed principal schedule.
Keep practising Securitization
Browse all Securitization questions for CA Final, or explore more Strategicfinancialmanagement topics.
Related questions
Which US agency guarantees timely MBS payments with the full faith and credit of the US goWhich extra risk does an MBS carry compared with a vanilla corporate bond?A pool has Rs 200 lakh maturing in 120 months and Rs 600 lakh maturing in 240 months. WhatA mortgage pool has Rs 300 lakh at 6% and Rs 100 lakh at 8%. What is the weighted-average An MBS factor measures what?A principal-only (PO) stripped MBS has cash flows backed by what?Which MBS is backed by mortgages on single-family, one- to four-unit real estate?The term "tranche" in French literally means what?