What is a 40-Year Fixed Loan?
Answer:
A 40-year fixed rate mortgage loan is comparable to
the traditional 30-year loan. The only difference is that borrowers who choose a 40-year loan program receive a longer repayment period. This loan type has advantages and disadvantages.

A 40-year fixed mortgage loan offers lower monthly payments, which makes this loan a good choice for homebuyers who want to keep their expenses low. Plus, the fixed rate option equals predictable payments. Unfortunately, borrowers who choose a longer loan term pay a higher interest rate, and it can take years to acquire equity. Of course, once a borrower’s finances improve, they can always refinance their mortgage and shorten the term.
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written by mmassullo , June 10, 2008

If you're disciplined, you can make additional payments toward principal, which reduces your term and essentially reduces the interest you're paying.

Good sources of funds to use to add toward your principal balance would be bonus income, commission income and tax refund.


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