Congrats on the journey. From what I have read and researched buying with 0 down and on an interest only mortgage is very risky with the market changes. Honestly I would suggest doing a first time home buyers with a 3% down payment. You will pay a PMI insurance which backs the mortgage if you default. You pay a few dollars extra a month for having this. The PMI is a hud based/backed loan. Then at a year you can refinance and put the earned equity into the house and lower your cost. I did that when I bought my house 5 years ago. Best thing I ever did. When you refinance the PMI comes off and you are on a conventional loan. The best part is you are paying on your house and you are paying what is considered the market interest rate. The rate is not higher as a penalty.
I personally won't think of doing interest only with what is going on in the market. There was an article recently in the financial times. I will see if I can find it and pm it to you. My friend just bought a house and took out a conventional mortgage and a piggy back which is interest only. They are trying to hurry up and refinance and consolidate it into one loan only because the interest on that interest only loan is a almost 10%.
Good luck. I will try to find that article to describe the comparison and the downfalls of all mortgage variables.
__________________  Lulu will always be in my heart  |