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jharden2000 · Joined: 12 Nov 2009 Posts: 1 1.25 Dollars($)

If you also pay down the principal on the first seven years of a 7/23 loan, will the remaining 23 years of the loan be based on the reduced principal?

jenkin7 · Posted: Fri Nov 13, 2009 3:10 am Post subject:

Hi jharden,

If you make extra payments and start paying down the principal during the first seven years of interest only payments, the rest of the mortgage balance should be amortized on the basis of the reduced principal amount. You should talk to the lender regarding this.

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Can the remaining principal of a 7/23 Two Step Loan be reduced before the fixed rate is applied to the remaining balance?