What term is used for allowing partial payment toward a mortgage while keeping the remaining balance active?

What term is used for allowing partial payment toward a mortgage while keeping the remaining balance active?

• A. Partial discharge
• B. Refinance
• C. Balloon payoff
• D. Loan Restructuring

Answer: (A)

The correct term for allowing partial payment toward a mortgage while keeping the remaining balance active is often referred to as "partial discharge." A partial discharge occurs when a borrower makes a payment that reduces the principal amount of the loan, while the mortgage remains in effect for the remaining balance. This can be beneficial for homeowners looking to reduce their debt without completely paying off the mortgage or refinancing the entire loan. It's important to note that while other options like refinance, balloon payoff, and loan restructuring involve adjustments to the mortgage, they do not specifically refer to the act of making partial payments while maintaining the original mortgage agreement. Refinancing typically involves replacing an existing loan with a new one, often with different terms. A balloon payoff refers to a large final payment due at the end of a mortgage term, while loan restructuring generally relates to changing the terms of the loan agreement as a whole rather than accommodating partial payments on an existing balance.

The correct term for allowing partial payment toward a mortgage while keeping the remaining balance active is often referred to as "partial discharge." A partial discharge occurs when a borrower makes a payment that reduces the principal amount of the loan, while the mortgage remains in effect for the remaining balance. This can be beneficial for homeowners looking to reduce their debt without completely paying off the mortgage or refinancing the entire loan.

It's important to note that while other options like refinance, balloon payoff, and loan restructuring involve adjustments to the mortgage, they do not specifically refer to the act of making partial payments while maintaining the original mortgage agreement. Refinancing typically involves replacing an existing loan with a new one, often with different terms. A balloon payoff refers to a large final payment due at the end of a mortgage term, while loan restructuring generally relates to changing the terms of the loan agreement as a whole rather than accommodating partial payments on an existing balance.