Advice on Purchasing a Home

[Jason]

With lower middle class income. Any advice from homeowners/real estate agents/anyone in general would be immensely appreciated.

[Tiggnutz]

Never get an interest only mortgage loan never,never,never,never,never,never,never,never,never,never,never,never,never,never ever. Better to have a shitshack in a nice area than a palace in a ghetto.

[showa58taro]

What's an interest-only loan? What can they levy if not interest?

[Tiggnutz]

What's an interest-only loan? What can they levy if not interest?

A type of mortgage in which the mortgagor is only required to pay off the interest that arises from the principal that is borrowed. Because only the interest is being paid off, the interest payments remain fairly constant throughout the term of the mortgage. However, interest-only mortgages do not last indefinitely, meaning that the mortgagor will need to pay off the principal of the loan eventually.

Its for lower income or first time buyers to get a house. If you get this loan its knowing you will need to refinance to get a different mortgage in like 5 to 10 years before the interest only part ends and the payment increases drastically. Better served to get a fixed rate mortgage if possible.

[dave626]

What he said. Basically, you want to invest in the house, not just pay off interest. You want to make payments towards that and not just "rent". Currently, my best friend's house payments include the house itself, insurance and property tax. That's the best way to go if you can. That way you don't have to pay it all at once (ins. and tax).