from what i understand when using a hml you can borrow short term i.e., 6months. youcan pay back only interest in those 6months then pay the balance when u sell?
example: loan 50,000 @ 15%
total interest $7500
6months@1250 per month
is this all correct besides th extra points they may charge?
I must have missed something… I come up with $625/mo in interest only payments.
Abel,
I get it now I had divided by 6 months instead of 12 months
thanx 8)
I read their are lenders that will let you bypass the interest payments even, until closing. Can anyone confirm this info? So you would actually pay nothing until closing.
Some HMLs will let you defer interest until property is sold. I however STRONGLY caution borrowers to consider the implications.
1.) Paying interest on the payment amount being deferred
2.) “surprising” payoff amount
If you cannot make monthly payments you are probably not ready to be using a HML.
Other HMLs offer longer terms, up to 12 months.
Rob