Wells Fargo launches 10-year ARM w/ interest-only feature

Wells Fargo Home Mortgage is launching an interest-only loan product that doesn't require principal payment for a period of 10 years. Previously, the Wells Fargo interest-only loan was available only as either a 5 year or 7 year adjustable-rate mortgage (ARM). As like most long term interest-only loans, the interest-only payments will go fixed for 10 years, after which the loan will become fully amortized, meaning that the payments will include principal and interest and will fully pay off the loan over the remaining 20 years. The borrower can make principal reductions during the interest-only period.

For more information about interest-only loans and whether one may or may not be right for you, have a look at a recent article we published about interest only loans - when an interest-only loan makes sense