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1.25% Interest Only Mortgage

1.25% Interest Only Mortgage products are flexible. I am so confident in the 1.25% interest only mortgage, I have converted my home and investment property to the 1.25% interest only mortgage. 

An issue for many homeowners is managing income and expenses. Income varies and unplanned expenses can come up. For many, our mortgage payment  is our largest monthly expense, and the least flexible. The 1.25% interest only mortgage was designed to give you control over your mortgage payment. Choose one of four payment options each month by using the 1.25% interest only mortgage.

        Minimum Payment    With the 1.25% interest only mortgage, a payment is set for 12 or 60 months at a reduced rate. The minimum payment rate for the 12 month option is 1.25% and the 60 month option is 1.90%. This maximizes cash flow and may also defer payment of interest allowing greater flexibility in managing your tax deductions. This 1.25% interest only mortgage minimum payment can not increase by more than 7.5%. Read about the important tax considerations of a 1.25% Interest Only Mortgage. If you have concerns over deferred interest, read  about the small amount of appreciation required to offset it.

        Interest Only Payment    Defer paying principal  and improve cash flow. This option is not available if the interest only payment is less than the minimum payment.

        Fully Amortizing Payment Options    You may make a principal and interest payment based on either a 30 year or 15 year payment schedule. I have included a 1.25% Interest Only Mortgage statement as well.

The product allows you to choose your index from the 1 month LIBOR or the MTA.

Here is a 10 year average comparison between a 30 year fixed and fully indexed LIBOR, MTA, COFI, and the 1 year Treasury Index in chart form.

Additional Options    If you want the additional security of a fixed payment while taking advantage of the low payment rates, there is also a 5 year fixed payment option. With the 5 year Fixed Payment, you have a fixed minimum payment for the five years. You have four payment options to select from monthly to manage your cash flow. You have the ability to increase the term of your loan from 30 to 40 years lowering your payment even further. LTVs are available up to 100%!

The Minimum Payment Advantage    The example below is based on a $400,000 mortgage. It compares a traditional 30 year fixed rate payment based on the above 10 year average to the minimum payment based on the 10 year average. Assumes that the Minimum Payment increases by the maximum 7.5% per year.

                    30 Fixed                    Cash Flow Minimum                 Monthly Savings                    Annual Savings

Year 1        $2,855                                $1,287                                 $1,586                            $18,816
Year 2        $2,855                                $1,384                                 $1,471                            $17,652
Year 3        $2,855                                $1,488                                 $1,367                           $16,404

                                            Savings over 3 years        $52,872
                                            Savings invested at 8%    $56,885

I have developed an Adobe document detailing how this program works. Send me an email requesting a copy. I have added a website dedicated solely to this product.

Email 1.25%interest only mortgage questions.

Here is a useful payment calculator

Read very important information about Prepayment Penalties

Read more about Closing Costs

As a Certified Mortgage Planning Specialist, I offer an analysis of your situation today can make suggestions on how small changes in how your debt is structured today can have a life changing effect in the years to come.  Read more about this free, no obligation service.

    1.25% Interest Only MortgagePrequalify for your 1.25% Interest Only Mortgage

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