What You Should Know about Interest-Only Refinancing print email to a friend An interest-only loan gives you the option of
paying just the interest , or paying interest and as much principal as you want in any given month. The interest-only
option is available in the initial years of the loan for a fixed number of years. After the interest-only period, all
payments will then include principal and interest. Interest-only loans can be either traditional fixed-rate or
adjustable-rate mortgages. Quicken Loans offers interest-only refinance options that are interest-only for the first 10
years. How Interest-Only Loans Work: If you choose to make the interest-only payment one month, that month's payment is
lower than it would be had you made the principal and interest payment. Your interest rate may or may not be lower than a
traditional mortgage, but you will have the option of choosing your payment. Sophisticated homeowners know that having this
type of payment flexibility is one of the smartest ways to manage your personal finances. Refinancing from a traditional
home loan to an interest-only loan has become popular because it gives you control over your cash flow. It's this simple:
with an interest-only loan, in months when you need more cash, you don't have to pay principal and interest. You can just
pay the interest. Who Is an Interest-Only Refinance For? Refinancing to an interest-only loan is a good choice for anyone
looking to make their money work harder for them. For instance, making interest-only payments and putting the difference
into an investment which brings a higher rate of return. Traditional mortgages offer no such option. That's something to
think about if you're not maximizing your yearly 401(k) and IRA contributions. But there are other things you can do with
the extra cash you can have every month: You could pay down high-interest credit card debt. Save for your children's
college tuition. Buy or lease a second family
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