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Ask Shop Rate: Mya, DE

Posted by  on Apr 16, 2009
 
Is there such a thing as a 10-year interest only loan? If so, what are the benefits and downfalls of this type of loan? Not exactly.

There is a 30 yr fixed rate loan that has an interest only feature for the 1st 10 yrs and then becomes a 20 yr fixed for the last 20 yrs. There is also a fixed/adjustable mortgage that has a fixed rate for the 1st 10 years and has interest only payments also due for the 1st 10 yrs. After the 10 yr period, the loan becomes 'amortizing' meaning principal is due to be paid along with interest as well as the loan then becoming a variable/adjustable.


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