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When Debt Is Too Good to Be True

Selena Maranjian
January 26, 2005

Imagine it -- an interest-only mortgage, which offers you lower monthly payments than a traditional mortgage. You pay only interest on the loan for the first several years. Then, you either refinance (ideally after your home has appreciated in value), pay off the loan in full, or start making payments on the principal (payments that can be much more than you'd have paid with a traditional mortgag