Interest Only Home Mortgage giving you the ultimate flexibility
interest only home mortgage to free up money for other use
Interest only home mortgage is a home equity mortgage loan up to 80% of value. It is suitable for a home buyer mortgage or as home equity loan refinancing for borrowers with proven income on their tax returns plus good credit.
Lower Interest only payments. flexibility. Improved Cash flow.
With this type of home equity mortgage loan you are only making interest payments amortized over 30 years, for the entire 5-year term of this mortgage. You are not repaying any principal. As you are only making interest payments, this lowers your monthly payments, giving you the ultimate flexibility increasing your cash flow.
When you are only making interest payments on your mortgage, your monthly payments will be lower, giving you extra cash flow and flexibility with your finances.
For instance with this home equity loan Canada you save money on mortgage payments:
- $400,000 mortgage amortized over 25 years at a 4% interest rate carries a monthly payment of $1,902. But if you were making interest only payments, your monthly cost should be about $1,321. This gives your extra $580 in monthly cash flow to put into a more important use.
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Who is interest only home mortgage suitable for?
When it comes to loans to buy a home where you want the ultimate flexibility, you get it all with the interest only home mortgage.
- Let's say you are all set to buy a home with 20% down. Your income is high enough for the mortgage amount needed but you are carrying other high interest debts such as credit cards, car loans, etc., that you want to start paying down. Consider this strategy: You save money on mortgage payments with a home equity mortgage loan with interest only payments and use the extra cash saved to pay down your more expensive debts.
What if your overall annual income is high but your work is seasonal.
- You have the flexibility of low mortgage payments during your slower work times and with your annual 20% pre-payment privilege, you make lump sum payments back into your mortgage during your busy season, reducing your principal mortgage amount and accordingly, the amount of interest you pay over the term of your home equity loan Canada.
Maybe you are growing your real estate assets and want to keep your payments low to improve your cash flow. This allows you to put your cash into a better use, that is more important to you.
Or, instead of getting a more expensive home repair loan, you want to manage your cash flow in a way that you have regular extra cash to use as your self funded home renovation financing one month at a time.
There are many reasons you may choose an interest only mortgage.
The main Reason is to free up money for other use.
Marie Copeland FSU, Mortgage broker Hamilton to help you with interest only home mortgage options.
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