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By Jacob Malherbe

Interest Only Mortgages is a risky product and does have its disadvantages it a tricky form of mortgage because it can be misleading as the payment is very small for the first 1,2,5,7 or even 10 years. The Interest Only Mortgage will have a balloon payment for the entire principal balance at the end of the loan term. Interest only mortgages might be beneficial for people in markets where houses appreciate rapidly and the plan is to remain in the house for only a couple of years.

Interest only mortgages are available in both fixed rate and adjustable rate varieties, but most interest only mortgages are of the adjustable rate variety. Since only an interest payment is due, interest only mortgages usually have a lower monthly mortgage payment than mortgages that require principal and interest payments.

For example, if you have taken an interest only mortgage loan for 5 years you only pay the interest on your mortgage for 5 years. The interest only mortgage rate is an adjustable rate determined by the current interest rate. This preset margin will stay fixed throughout the remaining term of the loan while the interest only mortgage rate added to it will change (generally on an annual basis) with the fluctuation of the current index rate. So after the interest only mortgage payment period is over you will be paying the adjusted interest only mortgage rate and the principal, which will increase your interest only mortgage payments.

Interest only mortgages usually have an interest only payment option during the first 1, 3, 5, 7, or 10 years of the mortgage. Interest only mortgage payment does not mean negative amortization on your loan it does mean however that the Interest only mortgage payment are only for a short term. Interest-only loans are the latest tool aimed at offsetting high home prices and it does represent a somewhat higher risk for lenders, and therefore are subject to a slightly higher interest rate. It is however a popular ways of borrowing money to buy an asset that is unlikely to depreciate much and which can be sold at the end of the loan to repay the capital. It helped homeowners afford more home and earn more appreciation during this time period. Interest-only loans may turn out to be bad financial decisions if housing prices drop, causing those borrowers to carry a mortgage larger than the value of the house, which in turn will make it impossible to refinance the house into a fixed-rate mortgage.

It is important to keep in mind the nature of interest only mortgages. Although interest only mortgages play a vital part in the mortgage industry, often providing the only means for first time buyers to hold the key to their own front door, misusing this type of loan is counter-productive. A sample of the 3 payment options on a loan amount of $250,000 would be: Minimum Amount Due $804, Interest Only Mortgage $989, 30 year payment $1304, 15 year payment.

In summary, an Interest Only Mortgage Loan can save you thousands of dollars and possibly earn you thousands more with the right diversified investments over time. An interest only mortgage loan gives people the tools necessary to manage their debts as carefully as they manage their assets. 30 year interest only mortgages typically come with a ten year (often referred to as a 30/10year interest only loan) or fifteen year fixed (30/15) interest only period. Best for people who: Are very focused on money management Want to reduce their monthly mortgage payment and do not intend to be in their homes more than a few years Interest only mortgages and loans as the name suggests, means you pay interest only for the first three, five, seven, ten years of the loan, thereby lowering your monthly mortgage payment by quite a lot. But it is important to also look at the other side of the interest only mortgage if the base interest start to rise your payments can start to rise with it. So have a close look at the relationship between the interest rate and your mortgage payment today before you jump into an interest only loan.

About the Author: Jim Power is a writer for the mortgage website

mortagesave.com

for more information about different mortgage types please visit

mortagesave.com

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By Gabriel Adams

Our homes are a place in which many of us feel sale. While this is true for the most part, the safety and security of your home should always be on your mind. By implementing a few of the home safety and security tips outlined below, you are likely to protect yourself, your home, and your personal belongings from harm.

Perhaps, the best home security tip to implement is the locking of all doors. Even those who live in ‘safe,’ neighborhoods are encouraged to keep their doors locked, especially at night. In fact, did you know that your doors should be locked even when you are home? This is one of the best ways to protect yourself and your home from intruders.

In addition to door locks, window locks should also be examined. If an intruder is set on getting into your home, a window is a method of entry that they are likely to try. It is a good idea to install locks on all windows in your home; however, it is extremely important to do so on the first floor or with any easy accessible windows. With that being said, buying and installing window locks isn’t enough, as you need to be sure to use them to your advantage as a homeowner.

Another great home security tip involves keeping the entranceways to your home well lit. This includes any backdoors or secondary entrances. For the best sense of safety and security, outdoor motion lights should be used. If motion sensor lights are not an option, be sure to have all lights turned on if you will be returning home after dark. Also, make sure all outdoor light switches are easily accessible to you from both inside and outside of your home.

All homes should clearly be marked with the proper address. This is important, should you need to call on assistance from emergency response professionals. Use large, bright, and bold numbers to highlight your address on your mailbox alongside the road. In addition to a mailbox, a home should also be marked with the proper street address. This will assist with the easy response should someone in your home suffer a medical emergency or if you need to quickly report a break-in.

The above mentioned home security tips are ones that are easy and affordable to implement. However, it is also important to examine home security systems. Although home security systems can get costly, be on the lookout for any sales and discounts, as many reputable home security companies do offer them. In keeping with costs, it is important to look at home security systems as an investment, not just an average, everyday purchase. Should you ever find yourself in an emergency, a home security system can, literally, be a lifesaver.

As a reminder, even if you reside in an area that is deemed ‘safe,’ you can never be too careful. By keeping a close eye on the news, you can easily see that crimes and other emergencies can happen anywhere and at just about any point in time. That is why you should take steps to protect your home, making it safe and secure.

About the Author: Visit the

Manhattan Locksmith

for help securing your home.

Source:

isnare.com

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