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Originally Posted by Thorn
Not having obtained a mortgage quite a while, I'm guessing that means that someone is never paying against the principal? If that's true, then it strikes me as being extremely stupid. What good would it do you? You'd never have any equity, and you'd never pay the damned thing off. You might as well pay rent.
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There is a "right way" to use an interest only loan. You get the lower payment, but you make the "full payment" and it ALL goes against the principal. That makes it a GOOD move. If, however, you simply make the minimum payment, then you are correct Thorn and its a stupid move.