Final answer:
Maturity of a mortgage is reached when the term length is completed and the borrower must decide whether to renew the mortgage or pay it off. It is an important concept in understanding how mortgages are handled by both banks and borrowers over time.
Step-by-step explanation:
The correct answer to which of the following best defines maturity is d) When the set term length of the mortgage has been fulfilled, and the customer must choose to renew or pay out. Maturity in the context of a mortgage refers to the point in time when the original term of the mortgage is completed. Most mortgage terms are either 15 or 30 years, after which borrowers typically have the option to renew their mortgage with the same lender, transfer it to another lender, or pay off the remaining balance in full if they are able to do so.
Mortgages are viewed as assets to banks due to the obligation of the borrower to make payments over the term of the loan. The present value of the mortgage loan can be assessed by estimating what another party might pay for it in the secondary loan market, where loans are bought and sold among financial institutions after being originated in the primary loan market.