Interest Only Mortgages
I have a friend who is buying homes as investments. He has purchased one of them using and interest only mortgage, and plans to have tenants, he rents these out, pay the actual monthly payment and then add his own money on top of that to hit some of the principle.
I think he has two years before he has to refinance or deal with that mortgage jumping by at least 50%. Do you think the credit market will be a bit looser by then? He's now sweating the possibility that he won't be able to refinance.
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