Question: answer to this question Question 9 Because she has been transferred, Velma lists her home for sale at a price of $100,000. She bought the

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Question 9 Because she has been transferred, Velma lists her home for sale at a price of $100,000. She bought the house only 6 months ago, and at that time financed the purchase by means of an $80,000 mortgage with a 3 year term. She receives an offer from ABC Ltd. for the full purchase price, payable by $20,000 cash, and the balance by ABC Ltd. assuming the $80,000 mortgage. The president and sole shareholder of ABC Ltd. is a very wealthy real estate developer easily able to afford the payments. Which of the following statements is TRUE? The financial profile of ABC Ltd. is crucial because the company, not its president, is assuming the mortgage. If house prices are clearly going to remain stable over the balance of the term of the mortgage, Velma need not worry about the assumption of the mortgage. The financial profile of ABC Ltd. is irrelevant if the rent it can collect on the house will cover the mortgage payment. All of the above

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