Interest-only mortgages become popular despite risks as home prices rise.

Publication: Ocala Star-Banner (Ocala, Florida) (via Knight-Ridder/Tribune Business News)

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COPYRIGHT 2005 Ocala Star-Banner

Byline: Steven Ray Haberlin

Sep. 18--OCALA -- The loan sounds very attractive at first glance.

Lower monthly payments. Buy a big house without a big income.

The mortgages are called "interest-only" loans, and brokers and lenders say greater numbers of Marion County homebuyers are relying on these unconventional financing options to deal with the area's skyrocketing real estate prices.

Interest-only mortgages, which give borrowers lower monthly payments because they don't pay any principal until later, give home shoppers more buying power.

But experts warn that these loans are not for everyone. While the borrower gets the benefit of low payments in the short term, the payments get much larger later...

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