Question

The amount of money the banker or broker makes in commission on your loan is called the_____. Down payment, interest, yield spread, none

Answer 1

Answer:

I believe the answer is Yield Spread

Step-by-step explanation:

So Basically what a down payment is, it is an initial up-front partial payment for the purchase of expensive items such as a car or a house. It is usually paid in cash or equivalent at the time of finalizing the transaction. A loan of some sort is then required to finance the remainder of the payment. You usually pay 10-20% of its value.

Interest is when you don't pay your bills on time and what ever company you owe money to will add a certain percentage on top of what you own. So if you owe 10 dollars and didn't pay it depending on its interest rate it would be 10.70 for 7% interest rate. So the banker or broker would make that on there commission.

Yield Spread is a really interesting the yield spread or credit spread is the difference between the quoted rates of return on two different investments, usually of different credit qualities but similar maturities. It is often an indication of the risk premium for one investment product over another. The phrase is a compound of yield and spread.