Im in the process of refinancing and im not sure which option i should take between the following options:
Both will have a sample 300k loan
IO rate: 4.85
IO period for 1 year and C&I for 34 years.
Monthly payment would be 1212 for first year and then it would revert to 1302
Rates remain the same.
IO period for 10 years and C&I for 25 years
Monthly payment would be 1212 for first 10 years and then would revert to 1542.
Which would would you take and why?
My thoughts are that option A would be more consistent and interest rate would be lower for more of the payment term although half of it can be expensed anyway. Option B gives more short term flexibility for the next 10 years but then the payment will be higher for the rest of the mortgage. Im wondering with inflation would it make sense to go for Option B maybe as money wont be worth as much in 10 years.