Rental property tax tip #2 – interest only loan?
Choosing an interest-only loan V principal & interest
Principal & Interest loan is a usually a personal choice. However do consider that banks are now usually charging a higher interest rate on interest-only loans (up to ½ a percent).
Also consider that in 2-5 years’ time when your interest-only period finishes, they usually put you on a high P&I interest rate, so you will likely go through a loan re-negotiation application to get a better rate.
By Patrick Hoey