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The use of mortgage debt to help finance an investment is commonly referred to as: A. leverage. B. capitalization. C. amortization. D. acquisition.

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Martebi

Leverage is simply known as when an individual or firm uses borrowed capital or debt to increase the potential return of an investment. The use of mortgage debt to help finance an investment is known as  leverage

  • Leverage is known to be the most common way to use one's our own money or through a mortgage. It often works to one's advantage when real estate values increases, but it can lead to losses if values reduces.

Mortgage Debt is simply defined as the type of debt owed by a Company or any Subsidiary that is secured by a Lien on one or more parts of real property.

Leverage involves using debt to rise the return on investment and it is a straightforward process.

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