All About The 40 Year Mortgage Loan: Pros and Cons

All About The 40 Year Mortgage Loan: Pros and Cons

Similar to the traditional 30 year mortgage, with an amortization term 10 years longer, the 40 year loan could help a borrower achieve greater purchasing power in getting into a home they could not otherwise afford by reducing their monthly payment and stretching it out over a longer time horizon. The 40 year mortgage has been around for several decades and goes in and out of popularity based on current interest rates and housing prices. The 40 year loan term has been most prevalent in those areas where housing costs have exceeded a region’s growth rate of income. However before proceeding with a 40 year loan, a borrower should carefully weigh all the options and consider exactly what they hope to gain from the 40 year versus other types of loans available. The following are some pros and cons to think over before making the move into a 40 year mortgage:

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