Fixed rate mortgages-- interest only or not?

I have been mortgage shopping, and I have been quoted on 30 year fixed rate mortgages, both interest only and regular. The interest only sounds like a good deal b/c it is a fixed rate, and you have the option of paying the lower payment if you need to one month, but if you want to pay more toward your principal, you can do that. You see, DH and my salaries will be increasing steadily as the years go on, and we don't plan on staying in this house for more than 6 or 7 years. Any thoughts? Experiences good or bad?

Re: Fixed rate mortgages-- interest only or not?

IO may work for you if you are definitely expecting a salary increase. I believe that most IO don't go up (begin paying principal) until the 10th year (could be wrong on that though) - so you wouldn't even see the increase.


If you are going to be in the house 6-7 years, you will most likely ride through this down turn and see equity, even if you never pay anything to principal.


You definitely have to weigh all the scenarios - good luck!