Mortgage Agent Licensing Practice Exam · Question
Who does mortgage default insurance primarily protect in the event a borrower defaults on their mortgage payments?
Mortgage default insurance is designed to protect the lender from financial loss if a borrower fails to make mortgage payments. It allows lenders to offer mortg
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Question: Who does mortgage default insurance primarily protect in the event a borrower defaults on their mortgage payments?
Answer options:
- The borrower
- The mortgage broker ✅ The lender
- The property seller
Correct answer: The lender
Explanation: Mortgage default insurance is designed to protect the lender from financial loss if a borrower fails to make mortgage payments. It allows lenders to offer mortgages to borrowers with smaller down payments, thereby increasing access to homeownership.
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Question explanations
- Which of the following is NOT a primary provider of mortgage default insurance in Canada?
- When must a mortgage agent provide the borrower with certain disclosures regarding the proposed mortgage, part
- Michael and Jennifer are applying for a mortgage to purchase a home in Calgary for $700,000. Their combined gr
- Which of the following scenarios would typically lead to a higher mortgage interest rate for a borrower?
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