Final Answer:
Under an FHA graduated payment mortgage, the term of the loan c) Monthly payments fluctuates over. (option c)
Step-by-step explanation:
Under an FHA graduated payment mortgage, the element that fluctuates over the term of the loan is the monthly payments, as indicated by option c. In this mortgage structure, the borrower's monthly payments start at a lower amount and gradually increase over time. This allows borrowers to manage lower payments initially, with the expectation that their income will grow, enabling them to handle larger payments in the future.
The fluctuation in monthly payments is predetermined and follows a schedule agreed upon at the beginning of the loan. This schedule typically includes a set period during which the payments increase before stabilizing. The objective is to align the borrower's payment capacity with their expected income progression. While monthly payments change, other components like the interest rate, loan amount, and loan term remain relatively constant over the life of the loan.
In summary, the FHA graduated payment mortgage structure provides borrowers with flexibility by adjusting monthly payments based on a predefined schedule. This feature caters to borrowers who anticipate an increase in income over time and allows them to enter homeownership with more manageable initial payments.(option c)