Illinois Real Estate Exam Practice Question
Elderly homeowners paid off their loan 5 years ago. Due to a limited fixed income, they would like to borrow on the equity of the home. Which type of loan would be most desirable?
Correct Answer: B
Rationale: A reverse mortgage is specifically designed for elderly homeowners, allowing them to access the equity in their home without monthly repayments, making it ideal for those on a fixed income.
Option A, an open-end loan, provides flexibility but requires regular payments, which may not suit their financial situation.
Option C, a blanket loan, is typically used for multiple properties and is not relevant for a single homeowner looking for equity access.
Option D, a growing-equity loan, involves increasing payments over time, which may not be feasible for individuals with limited income.
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