Use the right loan

Use the right loan

“The first payment is what made us think we were prosperous and the other nineteen are what showed us we were broke.” – Will Rogers

There are two main types of loans – principal and interest (P&I) where the debt reduces over time, and interest only where you owe the same at the end of the period as when you started. My advice is to use a P&I loan when the interest is not tax deductible and an interest only loan when the purpose of the borrowing is for investment.

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