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1. – The borrower pays interest only during the inital fixed period term (5 years). The unpaid balance is then fully amortized over the remaining term of the loan as an adjustable rate mortgage. The borrower may make voluntary principal payments during the interest only period.

   – A popular variety has a fixed rate with interest-only payments for the first five years. Then it converts to a 1-year ARM. You could face serious payment shock if interest rates rose significantly during the first five years.

   Mortgage Rates in Texas – TX Home Loans | Zillow – How to Find the Best Mortgage Rates. Mortgage rates can change daily, and can vary widely depending on the borrower’s personal situation. The difference can mean tens of thousands of dollars over the life of the loan.