Interest-only home loans are relatively uncommon these days, but they are still favorable in certain situations. Every home buyer knows that the type of mortgage you select when buying or refinancing a home can have a dramatic financial impact that lasts decades. It is essential for you to know all of your options and assess them with your unique financial situation in mind. The best way to ensure this is to consult with a qualified mortgage company such as You First Mortgage in the Santa Rosa, CA area. We have established relationships with a variety of interest-only mortgage lenders, so we help you navigate your options and provide you with several rates. Learn the pros and cons of interest-only mortgages, browse options, and get a home loan that works for you with the help of Northern California's most knowledgeable mortgage firm!
You First Mortgage can help you identify your needs and determine which type of home loan is best suited for your situation. With extensive experience in the real estate and finance industries, our professionals are prepared to assist clients with a variety of needs. Find out if an interest-only mortgage is right for you. Call (707) 919-3103 or fill out our online contact form in order to get in touch with us. Our mortgage services are available to clients in and around Santa Rosa, CA.
In every type of loan, there is principal and interest. The principal is the amount you originally agreed to borrow. The interest is what you have to pay in return for borrowing. In an interest-only home loan, you only make payments on the interest for a certain period of time. This is typically 5-10 years. After that period ends, your monthly payment will begin to include both principal and interest. This way, you defer larger payments to the end of the loan's life cycle.
Maybe you want a more expensive home than you can afford right now. Maybe you need more money for regular expenses at this point in your life. An interest-only mortgage might be right for you. However, the effectiveness is dependent on you having the means to take care of those larger payments later down the road. You may see yourself making significantly greater income later in your career. You may also be confident that you can better invest the money you would've spent on principal payments in the beginning.
The main advantage of interest-only mortgages is the increased cash flow in the early years of the loan. Homebuyers who receive this kind of loan have more money to manage their monthly expenses until years down the road when they are (hopefully) in a better financial position to make large payments.
There are many pros and cons to interest-only mortgages depending on your current financial situation. They also depend on what you expect your future situation to be like. Our professionals can help you assess your situation and identify what is important to you. Then, we'll walk you through your options and apply for loans on your behalf. We take most of your legwork out of the home loan process.