Interest Only Mortgages

Interest Only Mortgages

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Have more flexibility to manage your cash flow with an interest only loan.

Interest Only Snapshot

With an interest only home loan, you can pay only the interest owed on your loan each month for a fixed term that is usually between 5 to 10 years. Since each monthly payment only goes toward the interest during this period, your loan balance does not decrease unless you make additional payments toward the principal loan amount. However, you have the right to pay more than the interest payment if you want. If you opt not to pay toward the principal loan amount then the loan balance remains the same.

Interest Only Benefits

Some of the advantages associated with an interest only mortgage include:

  • Lower monthly mortgage payments
  • More control over cash flow
  • Makes additional cash available to pay toward higher-interest debts
  • Your entire monthly payment during the interest only period usually qualifies as tax-deductible
  • For short-term investment property flips, interest only payments help keep costs low so you can maximize your return on investment

Interest Only Eligibility

Because interest only loans involve higher risk for lenders, the requirements for these loans are.

  • Ability to verify source and level of infrequent income
  • Ability to afford higher payments when the rate changes
  • Higher down payment
  • Lower debt-to-income ratio

Generally, interest only loans are beneficial if one of the following guidelines applies to your situation:

  • You expect to sell your home or refinance it prior to the interest only period ending.
  • Your income heavily relies on bonuses or commission checks that come infrequently during the year; so you want the flexibility of making interest only payments during the times when your income is low and then paying more when your income increases.
  • You expect to earn significantly more income in the next few years.

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Interest Only Mortgages

HOME / LOAN PRODUCTS / INTEREST ONLY
HomeFirst Mortgage

Have more flexibility to manage your cash flow with an interest only loan.

Interest Only Snapshot

With an interest only home loan, you can pay only the interest owed on your loan each month for a fixed term that is usually between 5 to 10 years. Since each monthly payment only goes toward the interest during this period, your loan balance does not decrease unless you make additional payments toward the principal loan amount. However, you have the right to pay more than the interest payment if you want. If you opt not to pay toward the principal loan amount then the loan balance remains the same.

Interest Only Benefits

Some of the advantages associated with an interest only mortgage include:

  • Lower monthly mortgage payments
  • More control over cash flow
  • Makes additional cash available to pay toward higher-interest debts
  • Your entire monthly payment during the interest only period usually qualifies as tax-deductible
  • For short-term investment property flips, interest only payments help keep costs low so you can maximize your return on investment

Interest Only Eligibility

Because interest only loans involve higher risk for lenders, the requirements for these loans are.

  • Ability to verify source and level of infrequent income
  • Ability to afford higher payments when the rate changes
  • Higher down payment
  • Lower debt-to-income ratio

Generally, interest only loans are beneficial if one of the following guidelines applies to your situation:

  • You expect to sell your home or refinance it prior to the interest only period ending.
  • Your income heavily relies on bonuses or commission checks that come infrequently during the year; so you want the flexibility of making interest only payments during the times when your income is low and then paying more when your income increases.
  • You expect to earn significantly more income in the next few years.

""
1
Learn More About This Product
First Nameyour full name
Last Nameyour full name
Cityyour full name
ZIPyour full name
Phoneyour full name
Previous
Next