ANCHOR LEAD IN:
IF YOU'VE SHOPPED FOR A MORTGAGE LATELY, YOU KNOW RATES ARE GOING IN ONE DIRECTION -UP! BUT THERE'S A NEW TYPE OF LOAN THAT MAY GET YOU INTO YOUR DREAM HOME NOW...AS LONG AS YOU'RE WILLING TO PAY A LITTLE MORE LATER. AND WE'RE NOT TAKING ABOUT VARIABLE RATES -THESE MORTGAGES ARE FIXED! HOW DO THEY WORK AND ARE THEY RIGHT FOR YOU?
_________HAS TODAY'S HEADS UP!

TRACK ONE Length: 05
WHEN HOMEBUYER DAN BRASCH WENT SHOPPING FOR A MORTGAGE, HE HAD ONE THING ON HIS MIND...

SOT
KEY @: 07 Dan Brasch, Home Buyer
"Really the driving factor was affordability."

TRACK TWO Length: 04
DAN DECIDED ON A NEW TYPE OF LOAN CALLED A FIXED RATE, INTEREST ONLY MORTGAGE...

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KEY @: 14 Dan Brasch, Home Buyer
"It brought my monthly payments down as low as I could get them."

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KEY @: 17 Kristen Wilson, Loan Officer
"We're doing a lot more fixed rate interest only mortgages."

TRACK THREE Length: 09
LOAN OFFICER KRISTEN WILSON SAYS THE LOANS ARE EXPLODING IN POPULARITY BECAUSE THEY ALLOW THE SECURITY OF A FIXED RATE...WITH THE LOWEST MONTHLY PAYMENTS POSSIBLE TO START.

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KEY @: 29 Kristen Wilson, Loan Officer
"A fixed rate interest only mortgage has a period of time, usually between ten and fifteen years, where the payment that's due is only interest. It does not include anything on the principle."

TRACK FOUR Length: 10
AFTER THAT PERIOD, PAYMENTS GO UP FOR THE REMAINDER OF THE LOAN...BUT THE INTEREST RATE STAYS THE SAME. WILSON SAYS THESE LOANS ARE GOOD FOR PEOPLE WHO EITHER PLAN TO SELL IN A FEW YEARS OR...

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KEY @: 50 Kristen Wilson, Loan Officer
"...somebody who has a short term need for a reduced payment."

TRACK FIVE Length: 10
...LIKE CHRIS AND KATIE ROUSEMILLER. THEY BOUGHT A BIG ENOUGH HOUSE TO RAISE THEIR FAMILY AND FIGURE THEY'LL BE ABLE TO HANDLE HIGHER PAYMENTS IN A FEW YEARS...WHEN KATIE GOES BACK TO WORK

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KEY @: 1:04 Chris Rousemiller, Has Fixed Rate Interest Only Loan
"We could keep our payments lower for a small amount of time, and as our earning power grew, we were able to afford more."

TRACK SIX Length: 05
BUT FINANCIAL EXPERTS WARN WHILE THE LOANS MAY MAKE SENSE IN THE SHORTRUN... BE CAREFUL.

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KEY @: 1:17 Mara der Hovanesian, Business Week Magazine
"If your income doesn't improve these loans do get bigger, the minimum payments."

TRACK SEVEN Length: 05
THE HOMEOWNERS WE TALKED TO SAY THEY'VE GOT THEIR BASES COVERED BOTH FOR THE SHORT AND LONGTERM...

SOT
(covered) Chris Rousemiller, Has Fixed Rate Interest Only Loan
"I think this is a better way for us to manage this house."

SOT
(covered)Dan Brasch, Homebuyer
"I got in the most house for the money."

ANCHOR TAG:
WHILE THE LOANS ONLY REQUIRE YOU TO PAY INTEREST IN THE EARLY YEARS ...MANY WILL ALLOW YOU TO PAY DOWN THE PRINCIPLE IF YOU SO CHOOSE... EXPERTS SAY THAT'S A GOOD IDEA IF YOU CAN...SO THAT YOU EARN SOME EQUITY ALONG THE WAY.

SOURCE INFORMATION:

Kristen Wilson
Summit Mortgage Corporation
3001 Metro Drive
Suite 280
Bloomington, MN 55425
952-853-0222

Kristen Wilson has been a loan officer for over a decade. She says more and more people are opting for fixed rate interest only mortgages. However, she says these loans are best for people who have a firm plan for the future and know they will be making enough money to cover the rate increase.

Mara der Hovanesian
Business Week
PR Contact:
Patti Straus
212-512-2680

Mara is the Banking Editor at Business Week.