Why would you ever get an interest only mortgage?

Question

From what I understand about mortgages, which isn’t a lot at all, I just don’t see any scenario where an interest only mortgage is a good idea.

You pay it off for let’s say 20 years and you still have the full balance remaining. What am I missing?

In: Economics

Answer 1

One reason is if you are expecting a huge change in your salary in the (relatively) near future – such as a doctor doing his residency. He might be making average money for a few years but can very realistically expect his salary to triple or quadruple after that point.