Updated about 20 years ago on . Most recent reply
Loan Type
I'm getting ready to purchase a four plex and was set to acquire a 30 yr. fixed rate loan. A mortgage broker is trying to convince me to acquire an interest only loan stating that I can leverage my money best that way. Here's the two scenarios he gave me.
Scenario #1
I put down 85k on a 375k property. 30 yr. fixed at 6.9% at 1point and 1% origination fee. My monthly payment would be approximately $2450.00 impounded.
Scenario #2
I put down 39k on a 375k property. Interest only loan. Monthly payment $2400.00.
Lender states that scenario two is better because I can leverage my mony best and purchase another property as opposed to just one.
Is this guy just trying to make a bigger commision or is he correct in his thinking?