Frequently Asked Questions about Interest Only Home Refinance Rates

Here are the answers to the most commonly asked questions about interest only home refinance rates.

What is an interest-only home loan?

Interest only home refinance rates apply to interest only home loans, which are loans that allow borrowers to make just interest payments for a limited amount of time. During this initial interest-only period, borrowers can choose to pay only the interest or the interest and whatever amount of principal they choose. The interest-only period usually lasts for 5-10 years. Once the initial period ends, borrowers must make payments of both principal and interest for the remaining life of the loan.

What does interest only home refinancing involve?

Interest-only home refinancing can mean one of two things. First, borrowers who presently have an interest-only home loan might wish to refinance to a different type of loan. Usually, borrowers with an interest-only mortgage choose to refinance once the initial interest-only period is up. Secondly, borrowers who have a more traditional mortgage currently might seek out interest only home refinance rates in order to switch to an interest-only mortgage. These borrowers typically want to free up cash by reducing their monthly mortgage payment burden.

During the interest-only period, can I still make payments toward the principal?

Yes, one of the strongest appeals of interest only home refinance loans is that they allow the borrower to choose how much, if any, principal he/she would like to pay during the initial period of the loan. The borrower can make only interest payments or make whatever combination of interest and principal payments that he/she wishes.

How do I know if interest only home refinance rates are right for me?

If you would like to devote the money you spend on mortgage payments to other investments or expenses, you might consider shopping for interest only home refinance rates. Borrowers can free up thousands of dollars of cash over the course of a few years, which can then be applied toward investments, savings, debts, etc. Similarly, borrowers who have unpredictable incomes might appreciate the flexibility of interest only home refinance loans. During the months when cash flow is low, these borrowers can opt to make just the interest payment of the loan. Learn the dangers of interest only refinancing if you feel uneasy about mortgages.

How do I receive interest only home refinance rates?

You can get up to five free quotes on interest only home refinance rates by signing up on our site. We charge nothing for this service, so you have nothing to lose. After you supply your contact information, we will show you the offers of at least four of our certified lending partners. For your convenience, we display the home loan quotes side by side. You can quickly compare the loans on terms and rates. You are also not under any commitment to take out a loan if you decide to receive free quotes.

How long does the interest-only period usually last?

This will vary by lender, but most interest-only periods last from 5-10 years. After this time, borrowers can choose to either refinance to a different loan or begin making principal and interest payments.