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Interest-Only Loans Not Ideal

Question: In looking to refinance my existing mortgage, I've found some lenders offering interest-only loans. One lender is offering an interest-only option for 10 years. Because I plan to be in my current house for no more than 10 years, this seems attractive. The monthly payment is lower than that for a fully amortized loan, and because the payments are all interest they're 100% tax-deductible. Am I overlooking something?

By JACK GUTTENTAG

September 15, 2002

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