What Borrowers Need to Know About Interest-Only Loans With a traditional mortgage, buyers pay some part of the principal and interest with every monthly payment. An interest-only mortgage loan works differently: Borrowers are allowed to pay only the interest on the loan for a fixed period of time -- usually five to seven years -- and then must begin paying off the principal. At any time during the interest-only payment period, however, the borrower can pay down the principal, too, if he chooses. Then, once that interest-only period is up, the borrower may choose to refinance, repay the remainder of the loan in one big payment or begin paying principal and interest each month like it’s a traditional mortgage. Here’s what you need to know about interest-only loans... ExperienceMortgageFreedom
Posted on: Mon, 15 Jul 2013 16:33:36 +0000
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