I have recently purchased a home on a 5 year Interest Only Loan. I
understand all the risks that are involved. My question is what should
I do? Here are my stats for figures. The loan amount is 375K for a
home in Southern Orange County CA. The 5 year interest only is fixed
at 4.25% then turns into an adjustable loan. Should I refinance now
and get a fixed, wait the five years then switch to another I/O loan.
or should I pay a little extra a month towards principle for the five
years? Would doing that help me at all? After five years, lets say
that the interest rate is around 7%, would my loan go up to that after
5 years or would it only jump a percentage point?