Wednesday, May 03, 2006

Supersize Loan

California the first state to offer the supersize loan. Yes, a 50 year loan. This is an alternative to the interest only or ARM loans as payments are low and payments will be applied to principal, as opposed to interest only loans carry negative amortization. The 50 year loan has its critics, while it will offer lower payments than an interest only loan, it will cost more in interest than a typical 30 year loan, by tacking on 2 more decades of interest. This has been attractive to buyers in California because many people are buying too much of home, with half the homes costing over $500,000. Courtesy of PlanetRealtor.com