I am wondering if anyone knows of any federal banks or lenders that are offering interest only or partly amortized loans. I do not have the income or the capital to pay the conventional loan payments on a $600,000 property at the moment and would like to use interest only/partly amortized so that it is more affordable for me until I can afford to pay for a regular conventional loan. Also, if you know of any bank or lender in Colorado that does interest only or partly amortized loans, that would be even better. I look forward to hearing from you.
@Dalton Skach Where to begin, I am sure plenty of responses will tell you why this is a bad idea. Specific to your question, assuming a primary residence - because you didn't mention income from said property - I am not sure loans like this are even legal anymore following the government intervention of the lending world - Dodd Frank.
Hard money lending is not a federal loan, but is what you are describing. Very high risk, and typically 7-19% interest with 6 month terms-typically with the option to extend for an additional 6 months. The deal must pencil out as well, to mitigate risk.
I am doing new builds now, and the construction loans are interest only, 10% cash equity with 20% equity when complete. It doesn't sound like you have the income to support this, as the home will need to be refinanced into a permanent product after construction.
Hard money loans have helped jumpstart peoples real estate endeavors, just make sure you understand all of the risks associated.
Thank you both for the advice. I did not know that the interest was that high or that the loan term was that short on loans like that. I am obviously still learning and will look at other alternatives. I appreciate the response.
@Dalton Skach if you posted a few more details people might be able to give you a few options for what you are trying to do provided it makes sense.
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