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Nesgroup address: misc.consumers.house - Date & Time for the message: Tue, 19 Jul 2005 19:23:58 GMT /

Author of the message: "FDR"

Title of the message:
Re: Have Interest Only -- Should I Refinance to 30 year Fixed?

Text of the message:
"v" <vze8f3tq@verizon.net> wrote in message
news:42dd3893.1494051@news.verizon.net...

> On Tue, 19 Jul 2005 14:50:18 GMT, someone wrote:
>
>
>>Makes sense since in the first few years youy are paying mostly interest.
>>
> Deconstruct that a little and it makes no sense: "since initially I
> would be paying mostly interest and little principal, therefore it is
> better that I pay all interest and no principal"?

Yeah, because you'll be pocketing the extra few hundred a month and can save
it or invest it.

>
> An int-only is just a way to increase leverage, as are things like 95
> or 100 percent financing schemes, etc.  Leverage magnifies both risk
> and returns
>
> If you believe that real estate can only go up, and you can ride out
> any short term bumps, and the property is merely an investment, go
> ahead and leverage it, similar concept to buying stocks on margin,
> etc.
>



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