Ted Gehrke
Loan Originator
NMLS# 240314
ted@turboloans.com
Desert Equity Lending, LLC
NMLS# 173369 MB-0906989
Phone: 602-881-1414
Fax: 480-219-0849
Scottsdale, AZ
Apply Now
Ted Gehrke
Loan Originator
NMLS# 240314
ted@turboloans.com
Desert Equity Lending, LLC
NMLS# 173369 MB-0906989
Phone: 602-881-1414
Fax: 480-219-0849
Scottsdale, AZ
Apply Now

AZ: 480-245-8995
CO: 720-775-9866
APPLY NOW

AZ: 480-245-8995
CO: 720-775-9866
APPLY NOW

loans
apply now
MORTGAGE INTEREST RATES DROP TO HISTORIC LOWS!
$1295 Total Closing Costs, plus Appraisal, Title, & Pre-paids
 
 
apply now
MORTGAGE INTEREST RATES DROP TO HISTORIC LOWS!
$1295 Total Closing Costs, plus Appraisal, Title, & Pre-paids
 
 
Desert Equity Lending, LLC NMLS# 173369 | MB-0906989
Desert Equity Lending, LLC NMLS# 173369 | MB-0906989

Figure Payment

Loan Amount ($)
Interest Rate (%)
Loan Term (Yrs)
Payment:

Interest Only Loans

"Interest only" products are an easy way to save money and a very popular alternative to traditional fixed rates but they are not without risk. An "Interest Only" loan can offer consumers greater purchasing power, increased cash flow and a number of other benefits which are listed later in this article.

First let us start with a quick explanation of how the product works. With Interest only loans the borrower has the flexibility of paying only the interest due on the mortgage. Most of these products allow you to pay extra if you choose.

The positive aspects of these loans are as follows:

  • They work well for borrowers that are restricted by a tight budget, and the savings can be as much as $300-400 per month!
  • Interest Only loan can allow you to qualify for a bigger home. If the underwriter considers only the "Interest Only" payment, you may be able to upgrade to a nicer or larger home.
  • This type of loan works well for people who only want to stay in a home for a just a few years. During the first couple of years with a conventional 30 yr mortgage, most of your mortgage payment is being applied directly to the interest of the loan. If you want to stay in the house for only 3-5 years, an "Interest Only" loan may be the right loan for you. You can receive a lower payment and have almost the same principal balance as the borrower who chose a 30 year, conventional mortgage if you choose to sell in 3-5 years.
  • You want to buy a very expensive home. Most people who buy very expensive home have no desire to pay off their home completely, and the rate of appreciation on the house is usually very good. An "Interest Only" loan allows these borrowers to deduct their interest payments, and the money they save can be directed to other investments.
  • You want to buy a rental property. The lower payment can help improve cash flow on a rental property.

As with every loan program, with positives there are always negatives.

  • You are not paying down your principal on your mortgage. If your property doesn't appreciate in value over those 3-5 years, you may even have to pay money if you choose to sell the home. While the likelihood of this happening is high, it is a risk that must be considered when thinking about using Interest Only loans.
  • Most "Interest Only" products have a specified term. For example, on most 30 year fixed "Interest Only" loans, most lenders allow interest payments for 10 years, and then you must repay the loan during the last 20 years. This loan now must be amortized over a 20 year period, and this will carry a higher payment than a 30 year fixed mortgage. These loans may be a good option for you as a borrower, but each person's situation is unique.
  • Lastly, when in a period of incredibly low fixed rates "Interest Only" products will be very attractive. But, if you are planning on staying in your home for an extended period of time, you may want to consider a traditional fixed product.

CALL TODAY for your no obligation quote: 602-881-1414

Mortgage Lending State: Arizona and Colorado

Contact us:

Ted Gehrke
Fax: 480-219-0849
Direct: 602-881-1414
Email: ted@turboloans.com

The data relating to mortgage loans and/or real estate for sale on this web site comes in part from the Mortgage 101 program. All data on this web site is deemed reliable but is not guaranteed.

This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is displayed with the understanding that the publisher and authors are not engaged in rendering real estate, legal, accounting, tax, or other expert assistance is required, the services of a competent, professional person should be sought. The information contained in this publication is subject to change without notice.

DESERT EQUITY LENDING, LLC MAKES NO WARRANTY OF ANY KIND WITH REGARD TO THIS MATERIAL, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. DESERT EQUITY LENDING, LLC SHALL NOT BE LIABLE FOR ERRORS CONTAINED HEREIN OR FOR ANY DAMAGES IN CONNECTION WITH THE FURNISHING, PERFORMANCE, OR USE OF THIS MATERIAL.

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Service Provider

 

 

CALL TODAY for your no obligation quote: 602-881-1414

Mortgage Lending State: Arizona and Colorado

Contact us:

Ted Gehrke
Fax: 480-219-0849
Direct: 602-881-1414
Email: ted@turboloans.com

The data relating to mortgage loans and/or real estate for sale on this web site comes in part from the Mortgage 101 program. All data on this web site is deemed reliable but is not guaranteed.

This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is displayed with the understanding that the publisher and authors are not engaged in rendering real estate, legal, accounting, tax, or other expert assistance is required, the services of a competent, professional person should be sought. The information contained in this publication is subject to change without notice.

DESERT EQUITY LENDING, LLC MAKES NO WARRANTY OF ANY KIND WITH REGARD TO THIS MATERIAL, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. DESERT EQUITY LENDING, LLC SHALL NOT BE LIABLE FOR ERRORS CONTAINED HEREIN OR FOR ANY DAMAGES IN CONNECTION WITH THE FURNISHING, PERFORMANCE, OR USE OF THIS MATERIAL.

security Provided by OpenClose Proud Partner of OpenClose for 11 yrs
Service Provider