Texas Interest Only Mortgage
A Texas interest only mortgage is where you only pay the interst on the loan
and not any principal. This means your loan amount will never be reduced and
at the end of the mortgage loan, you will still owe the same amount since
you only paid the lender the interest.
People who often use this type of mortgage are ones who want to minimize
their monthly payments and pay down the principal on their own when they are
able to. Others who opt for interest only loans are those who don't plan on
staying in their homes too long and since the principal payment in the
initial free years are minimal, it makes perfect sense not to pay down any
principal on their loan.
A major drawback is if your home decreases in value, you may end up owing
more money than the home is worth and may be forced to foreclose or end up
working with a lender to short sale your home.
Interest only mortgages will higher rates than if you go with a normal
traditional mortgage that involves paying back interest and principal on a
It is advised that you speak to a few mortgage professionals who can help
you determine whether or not interest only mortgage in TX is a good avenue
for your family and you. Our network of mortgage companies can save you time
in searching for Texas mortgage brokers and lenders to contact.