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| Investment-Backed Mortgages |
| Investment-backed morgages are a
type of property loan where the buyer doesn't pay down the
balance during the term of the contract, but instead,
accumulates an investment in hopes of doing so in the |
future.
This type of arrangement is usually cheaper in the short term
(only the interest has to be paid on a monthly basis), but
higher risk in the long run. This is because there is no
guarantee that the investment will be sufficient to cover |
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the
balance, at the time of maturity.
Investment-backed home
morgages do offer some advantages, however, due to the fact
that they are a cheaper way for buyers to take advantage of low
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href="http://www.financefacts.info/morgage-rates/">morgage
rates in an improving real estate market.
About the author:
Jeremy Maddock is the webmaster of FinanceFacts.info, a useful
source of finance
articles.
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