Interest-only jumbo loans are a unique way to borrow money, whether you want to buy a house or something else big. A traditional loan needs money to be paid each month toward both the interest and the principal. Interest-only jumbo loans must be paid back every month, but you don't have to pay back the principal.
Who can use a jumbo loan that only pays the interest? Interest-only jumbo loans can be helpful for people who know they will get a lot of money in a few years. You might have a trust fund that says you can use the money when you turn 30, but you want to buy a house when you're only 24. Interest-only jumbo loans are the best way for you to get the money you need. During the first few years, you only pay the interest. Once you have enough money, you pay both the interest and the principal, or you may choose to pay off the principal quickly.
Interest-only jumbo loans can also be helpful for families whose income is likely to grow over time. Interest-only jumbo loans can be used to buy things that make life more comfortable. The larger principal payments can be put off until the borrower's income has grown. A junior partner in a law firm might think that interest-only jumbo loans are the best option because they expect their income to go up a lot over the next few years, which would allow them to pay back the principal during those years.
In the uncertain economy of today, interest-only jumbo loans can be a good option. If a debtor doesn't pay the principal for one or more months and only pays the interest, there is no penalty at all. This feature can be very helpful if you lose your job or have some other financial trouble. With a traditional mortgage, you might get phone calls threatening foreclosure, but with an interest-only jumbo loan, you won't have to worry about that. This will help you get through times when money is tight without adding to your stress.
