If you`re self employed or have seasonal employment, you need to know about this! Learn about a new kind of interest only ARM (adjustable rate mortgage) with the advantage of a fixed rate feature like in a classic five year interest only ARM, but also with the deferred interest option and associated lower minimum mortgage payment of a regular option ARM. The best of both worlds - a fixed interest rate with a flexible payment.
Traditional mortgage loans come with fixed interest rates and fully amortized payments. This means you pay the same amount each month until your mortgage is paid off. Interest only mortgages are different in that they do not amortize at all during the interest only period. Here are the basics of interest only mortgages to help you decide if this type of loan is right for you.
Around 1 out of ever 5 mortgage borrowers last year elected for an interest-only mortgage scheme. Of these, approximately 30% were new first time house buyers. "So what?", you may be saying.
Historically, interest-only mortgages have appealed more to rich borrowers. But times have changed. With increasing incomes interest-only mortgages have become appealing to borrowers of every stratum of the society and not necessarily just the upper classes.
Bookmark at Del.icio.us
