Posts tagged interest only
What is an interest only loan?

An interest-only loan is a mortgage in which a borrower only pays the interest (not the principal) on their loan for a set period of time, usually between 5 and 10 years. Then, the borrower will either begin paying down the principal, make a lump sum payment, or sell the house.

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What is an Interest-Only Mortgage?

When most homeowners get a mortgage, they start paying both the interest and the principal immediately -- but they don’t always have to. One kind of home loan, called an interest-only mortgage, allows the buyer to put off paying any of the principal for a number of years while they save money and strengthen their financial position. But, just because you don’t have to pay principal doesn’t mean you can’t; many homebuyers just like to have an option that frees up more cash for their budget.

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