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Contributed by mm | October 9, 2006 1:07 AM PST
Woo ... what an innovation. It is not without merits. After all, who will on earth stay in the same house for 30 years and keep paying the mortgage? Sooner or later, the homeowner will either move or refinance, so if a mortgage company can make this 30-year interest-free balloon offering attractive enough, enough people will try it.
From EZine:
Basics 30 year fixed loans are the standard loan that has been available for many years. A recent innovation has been to add an interest-only payment period to part of the loan.
Until recently the maximum interest only period was ten years. A new loan has been introduced that allows a borrower to make an interest only payment for 30 years.
A thirty year fixed loan with an interest only payment can be used for:
- purchases
- refinances
Purchases Getting a 30 year fixed loan is a decision many first time home buyers make.
A 30 year fixed loan has the advantage of an interest rate that remains unchanged for all thirty years of the loan. This allows the borrower to have stability in their monthly payment. They don’t have to worry about rising interest rates.
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40-Year Mortgage!!! (October 9, 2006)
Just as the California housing marketing is tanking, smart guys are inventing the 40-year fixed-rate mortgage. Yes, you can always extend the length of the mortgage to make an expensive house affordable to a few more folks.
How To Get A Mortgage With Bad Credit (October 9, 2006)
If you are a homebuyer with a poor credit rating you may be concerned how your credit score will impact your loan. Homebuyers with poor credit qualify for higher interest rates and pay higher fees; however, if you spend some time cleaning up your credit ...
35-Year Mortgage In California (October 9, 2006)
Yes, well said, "lenders and government agencies will do whatever it takes to spur the housing market." And now the marketing is crashing.
What Is Bi-Weekly Mortgage Payment? (October 9, 2006)
Truth be told, if you have a bit patience, you can do it yourself without paying anything for the "priviledge" to get your mortgage off your back years earlier. All you need to do is to send in the payments regularly.
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