i should also point out that we just sold our home in AZ (where it's a seller's market)...the house sold for $230k and our buyer did a 100% loan as well. When I saw that, I asked our realtor about it, kinda shocked that a bank would do that. She said banks will write just about anything right now (the guy actually financed $235,000 so he could cover his closing costs with the loan).
so you could probably get whatever loan you wanted (interest only or traditional) if you shop around with various mortgage companies. but if an interest only loan will reduce your monthly payment significantly enough (and if the amount of the monthly payment is a factor...ie you're going to significantly strain yourself to make the payment on a traditional loan whereas the interest only will be easier to make and you don't run the risk of running out of $ each month), then I wouldn't rule out the interest only. especially if the market's appreciating in your area the way you say it is (hell, the way it's appreciating everywhere). On Fri, 21 Jan 2005 10:43:53 -0500, Tony Weeg <[EMAIL PROTECTED]> wrote: > no i dont think so. > > in fact, i equate these kinds of loans to payday check loan places... > just doesnt add up, if you can afford to throw down at least some > downpayment on the house, and get a 30 year standard loan. they make > the most sense, and are a lot more secure as the INT, is set for 30 > years. > > jayme and i got a 30 yr 100% loan, only had to drop 4k on the day of > settlement, took the other 17k we saved and bought stuff for the > house. it ended up being a VERY nice, easy 1500/month mortgage, right > now, about 12k a year in INT, and the houses in our neighborhood are > selling for almost 100k more than we bought ours for 2 years ago, jan. > 3. so not only do we have a very standard loan, with no quirks, but > the equity is slowly getting chipped away, through larger than > expected monthly payments, and we still can take the 12k of interest > payments off our taxes in a few weeks ! > > we do have a 1 point PMI, but that can be erased in a year or so, if > we want to refinance and pay some closing costs etc... but thats to be > determined. > > tw > > > On Fri, 21 Jan 2005 09:06:32 -0600, G <[EMAIL PROTECTED]> wrote: > > I heard about these interest only loans, and frankly I don't understand > > their advantages. Isn't the equity in your home directly related to the > > amount of principal you've paid down? So, after 10 years of paying off > > interest....you own no more of your house than you did when you started. Is > > that correct??? > > > > I was even a little miffed when i learned my standard loan was heavily > > front-load with interest. Nearly 75% of my first couple of years payments > > went to interest anyway. That was on a 30 year. When I refi'd to my 15, my > > principal became more than 50% of each of my payments, which made me happy. > > > > Whether you are planning on staying in your house or not, it IS a sound and > > solid investment while you are there....and if the name of the game is > > reducing interest payments....i fail to see the value in interest only > > loans. > > > > Am I way off on this??? > > > > > > > Has anyone gone down the road of interest only loans for a mortgage? > > > You make interest only payments for the first 5, 10, or 15 years then > > > regular mortgage payments with interest after that initial period is up. > > > > > > Pros: > > > The entire interest initial payments are tax deductible. > > > You can take the principal portion of the loan you are not paying and > > > invest it. > > > Great for people not planning to make the home their final residence. > > > > > > Cons: > > > Need to be a disciplined saver/invester. > > > Monthly payments increase dramatically after initial period. > > > ? > > > ? > > > ? > > > > > > Looking for anyone who might have experience with this type of loan. > > > > > > Thanks! > > > > > > Mike > > > > > > > > > > > > > > > ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Protect your mail server with built in anti-virus protection. It's not only good for you, it's good for everybody. http://www.houseoffusion.com/banners/view.cfm?bannerid=39 Message: http://www.houseoffusion.com/lists.cfm/link=i:5:143748 Archives: http://www.houseoffusion.com/cf_lists/threads.cfm/5 Subscription: http://www.houseoffusion.com/lists.cfm/link=s:5 Unsubscribe: http://www.houseoffusion.com/cf_lists/unsubscribe.cfm?user=11502.10531.5 Donations & Support: http://www.houseoffusion.com/tiny.cfm/54
