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Interest Only Mortgage Loan

Interest only mortgage loan products can be an excellent choice for some individuals. Interest only mortgage loan products are designed to offer the lowest payment possible as you are not paying toward the principal in your interest only mortgage loan payment. Interest only mortgage loans may mean that you can buy more home. Interest only mortgage loan products are flexible. You may make additional payments toward your principal at any time. If you do, your next interest only mortgage loan payment will be lower as the payment is calculated on the current loan balance. This is different than with a fully amortizing loan where additional contributions to principal do not change the payment. Email  interest only mortgage loan questions

Interest only mortgage loan products were originally designed for individuals whose income is cyclical. For example, an individual who is a sales executive with a low base salary but commission payouts quarterly would benefit from an interest only mortgage loan. You have the lowest possible payment during months when no bonus is paid and you could make contributions to the principal balance when the bonus is paid. However, I am seeing individuals in many situations choosing an interest only mortgage loan as a method of lowering their payment, sometimes significantly.

Interest only mortgage loan products are available for a 30 year fixed term, with the first 10 years interest only and the final 20 years fully amortizing although I am now seeing many progressive lenders offering this option on interest only mortgage loan ARM products. Some lenders who offer an interest only mortgage loan require a prepayment penalty for the first 1-3 years and have caps on the amount your rate can change at any time and over the life of the loan. I always try very hard to avoid prepayment penalties on these and other types of loans and can usually work around the requirement.

Again, it is not the right choice for everyone, but it can be a very effective choice for some individuals. Please give me a call or send an email and I will be happy to discuss this alternative with you.

An example of how powerful this tool can be:

On a $250,000 mortgage at 6.000% for 30 years-
Principal and Interest payment= $1498.88
IO payment= $1250.00
Total Monthly savings= $248.88

Of all of the programs available, the Cash Flow Interest Only Mortgage Loan offers the greatest flexibility by far.

 I have a presentation in .pdf format on them, some real world examples, and some suggestions on how best to use them available by email

Read more about Interest Only Mortgage Loan Closing Costs

I have an article "Buying your home in 2008" by email explaining negotiating strategy in today's market.

In 2008, Short Sales are where most of the action in real estate is. Learn more about Short Sales

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.


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