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| *Loan,banking and credit>>>mortgage loan |
Why is payoff amount higher than loan balance on interest only mortgage? |
Why is payoff amount higher than loan balance on interest only mortgage? Possibly because you haven't been paying the minimum interest payments. I know on my interest only mortgage, they allow me to do this without penalty, essentially increasing my principle each month. They actually highlight an amount on my statement that is less than my interest, trying to trick me into paying less today. It's all part of the scam. Read your statement carefully and pay more than just the interest due. Because interest is accrued daily, so your loan company is collecting interest up until the day the loan is actually paid off. Both previous answer are true but you might also have a prepayment penalty. Prepay penalty could range from $500 to over a $1000. Becasue the mortgage payments are paid in the reares...meaning the bank allows you to live in the house ever month and than pay for it. example...pay Feb payment for Jan living. |
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