Interest Only Loan
Can anyone recommend a financing source that offers an interest only loan program for a two family? I understand this is getting rare, but there must be somebody writing such loans. Thanks!
Can anyone recommend a financing source that offers an interest only loan program for a two family? I understand this is getting rare, but there must be somebody writing such loans.
Thanks!
From what I understand, one advantage of an IO loan is that if you expect to have funds handy to pay down big chunks of the principle you reduce your monthly payment without having to refinance or repay the entire amount.
Yep, my point is merely that there’s nothing inherently bad with the product. For some people in some circumstances it can certainly make sense.
And of course for some people you’re right. In the wrong circumstances it can be a bad idea too. But who am I to judge personal circumstance.
With nods to the above naysayers, we just refi’d with an I/O 5/1 ARM on a 2-family. For some people, it’s a bad idea. For our situation, likely to move in 5 years, needing cash out to complete a reno, it was ideal. Anyway, Bank of America was the winner for us. They were one of the very few banks that offer an I/O with cash out refi. If cash out was off the table, there were many contenders for our business. Shaul Betesh from Manhattan Mortgage worked very hard to get the loan closed. Best way to reach him is SBetesh @ manhattanmortgage.com
Adam moved to WCSlending so his new email address is adahill@wcslending.
Astorian, loads of mortgage brokers out their but Adam actually knows his stuff and has a good reputation on here, hence he is all over Brownstoner.
Paying down principal is forced savings/paying yourself. I certainly concede that without much equity, this is a very risky strategy, but with a considerable down payment, there are instances where interest only payments make sense. My understanding is that IO was (maybe still is) standard for investment grade loans. Obviously you can’t run a household budget like a business, but a two family is only partially personal property.
Adam Dahill’s name is all over Brownstoner…he seems to have many satisfied customers…but is there anyone else in this business?!?
Johnny, If you can’t afford to pay the principal along with the interest, then you can’t afford the property. But sure, why not call a good mortgage broker like Adam Dahill. His email is
adahill@APPROVEDFUNDING.com
The problem was never the mortgage structure, it was giving them to anyone at amounts well above what they could afford.
OK, off my soap box. OP, call a mortgage broker or two – or try Wells Fargo. In NYC they tend to offer broadest range on multi-family. BUT . . . in the old days interest only’s were common and cheap. Now you might pay a premium, which is counter-productive.
I sure hope there isn’t, else it just means no one has learned anything.