mortagesandforeclosures

The current economic crisis is hurting homeowners across the nation. One saving grace that we do have is that mortgage rates are now it near historic lows. The main question that most people are facing is, what type of mortgage should I choose? Many people opt to choose the lowest
?monthly payment being with an interest only loan, however the majority of the homeowners in the United States are choosing a fixed rate mortgage for security and longevity. Let's explore the benefits of both types of loans.With interest only mortgages, a common theme is that they are adjustable in nature, typically only having a fixed period of 3 to 5 years. However, the benefit of this type of loan, is that the monthly payment is reduced to the lowest point possible, which frees up extra monthly cash flow. Many homeowners use this excess liquidity to pay down higher-interest rate car and credit card loans. Another reason one might choose this type of loan is because of a layoff or other unexpected life event that had a negative economic side effect. The downside of an interest-only adjustable loan is that it carries very little certainty. If interest rates suddenly go up, the borrower has very little protection and may be left with few options. It is important to know both the benefits and pitfalls of an interest only mortgage.Fixed Rate VS. Adjustable Rate Mortgage Loans

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