Question

A loan is a high-cost home loan if the loan's APR exceeds the average prime offer rate (APOR) for a comparable transaction by more than: (2 of 3) ___________ percentage points for a first-lien loan of less than $50,000 and secured by a dwelling that is personal property (e.g., a manufactured home).

A) 1
B) 5
C) 8
D) 10

Answer 1

A loan is classified as a high-cost home loan if the APR exceeds the APOR for a comparable transaction by more than 5 percentage points for a first-lien loan under $50,000 secured by personal property, such as a manufactured home.

Step-by-step explanation:

A loan is considered a high-cost home loan if the loan's Annual Percentage Rate (APR) exceeds the average prime offer rate (APOR) for a comparable transaction by more than certain thresholds. For a first-lien loan of less than $50,000 and secured by a dwelling that is personal property, such as a manufactured home, this threshold is set by specific regulations. The answer to the student's question, "A loan is a high-cost home loan if the loan's APR exceeds the average prime offer rate (APOR) for a comparable transaction by more than: (2 of 3) ___________ percentage points for a first-lien loan of less than $50,000 and secured by a dwelling that is personal property (e.g., a manufactured home).", is option B) 5 percentage points.