What arrangement might a bank provide to secure mortgage cash flows?

A bank may secure mortgage cash flows through an insurance policy. This typically refers to a hazard insurance policy that protects the lender's investment in the property. In the event of damage or destruction of the property, the insurance provides financial compensation that helps ensure that the mortgage payments can be covered, preserving the bank's cash flow.

Such policies are a standard requirement for most mortgage agreements, as they help mitigate risks associated with lending. If the property is lost or damaged, the insurance proceeds can be used to pay off the mortgage or restore the property, ensuring that the bank recoups its investment.

The other arrangements do not provide the same direct means of securing cash flows. A credit line may offer additional financial resources but does not directly secure the mortgage. Equity sharing involves partnerships where the bank may not have direct cash flow guarantees, and joint tenancy is a form of property ownership, not a financial arrangement that secures cash flows for loans.