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Basic Question 4 of 6

The lender of a commercial loan may charge a default interest rate during the workout period so that the term of the loan is extended. The borrower can then try to arrange for refinancing or sell the property to pay off the balloon balance. The default interest rate is usually ______ the original contract rate.

A. higher than
B. lower than
C. the same as

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I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz

Tamara Schultz

Learning Outcome Statements

describe characteristics and risks of commercial mortgage-backed securities

CFA® 2025 Level I Curriculum, Volume 4, Module 19.