Are Interest Only Fixed Rate Mortgages good for refinancing ?

3 Replies

Looking to refinance my non-warrantable property to pull out the equity. I was offered a 30 year fixed at 5% with a Interest Only Fixed Rate Mortgage. Has anyone had experience with this type of product? I know it is hard to get refinancing on non-warrantable properties so this may be an only option.

Thank you for your input.

@Vinny Incognoli doesn’t sound nickatnite sound too bad for non warrantable. Main thing would be fees. Also keep in mind that the interest only part is not fixed for the whole 30 years, I haven’t seen that atleast. Normally that part is for 5,7, or 10 years.

Originally posted by @Nicholas Covington :

@Vinny Incognoli doesn’t sound nickatnite sound too bad for non warrantable. Main thing would be fees. Also keep in mind that the interest only part is not fixed for the whole 30 years, I haven’t seen that atleast. Normally that part is for 5,7, or 10 years.

 They are a nightmare to work with, but a few of the non-qm lenders are now offering 40 year fixed rate loans, with the first 10 years being interest only. And they are indeed truly fixed rate for 40 years. But the payment is i/o, so the payment isn't fixed even though the rate is.