A lender offers a 'no-cost' refinance by rolling closing costs into the loan balance rather than charging them upfront. What is the primary trade-off?
-
A
The borrower receives a lower interest rate in exchange for the fees
-
B
The loan balance is higher, increasing the amount on which interest accrues
-
C
The loan term is automatically extended to 40 years
-
D
PMI is required regardless of LTV