I just purchased my first home in April with an interest-only ARM, with two separate loans (80% & 20% (to help avoid the PMI)). I'm not understanding how I'm building equity in my place when I'm only paying towards the interest of the two loans.
Also, I'm working on a plan to take any extra cash I have so I can pay down the higher of the two loans (the 20% loan of $37k @ 9.75%) so I can eliminate that loan altogether and lowwering my monthly payments by the $377 I'm paying towards that second loan. Am I on the right track with this idea? Has someone come across this before/have a better idea?
So I want to gain a better understanding of how paying interest-only is building equity AND I'm looking for ideas on how to make the most of the limited amount of cash I have on-hand.
2006-07-24
03:55:30
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6 answers
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asked by
Michelle's boyfriend
2
in
Renting & Real Estate