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The Interest-Only Flex Mortgage

What is it?

The Interest-Only Flex Mortgage is suitable for homeowners and investors looking to Purchase or Refinance up to 80% of the value of the home and take advantage of lower monthly payments during the term.

The Benefits

The Interest-Only Flex Mortgage offers clients an interest-only payment or a combination of an interest-only payment and an amortizing (principal and interest) payment with both Fixed and ARM [Adjustable-rate Mortgage] rates available.

An interest-only payment is where you only make payments of the interest during the term; you don’t have to repay the principal on the mortgage like on a traditional amortizing mortgage. Since you are only making a payment of the interest, your monthly mortgage payment will be comparatively lower, giving you choice and flexibility with your finances.

For example, on a $400,000 mortgage over 25 years at a 4% interest rate, the usual monthly repayment would be approximately $1,902/month. But if you were making interest-only payments, the monthly cost would be approximately $1,321/month providing an extra $580 in monthly cash flow. *this example is for demonstration purposes only.


  • Property investors that own multiple rentals and want to keep mortgage expenses low
  • People that are carrying other high-interest debts (i.e. student loans and credit cards) and will use the
    extra cash to pay these down
  • People with cyclical or seasonal work who would like to pay down their mortgage using their 20% repayment feature on a schedule that fits their irregular cash flow
  • People living in markets with high real estate prices can purchase a home in their desired
    neighbourhood with manageable monthly payments
  • People that have goals to improve wealth over the long-term and can put that extra cash to better use
    through investing opportunities, rather than using it to repay principal on a mortgage
  • People that seek greater control of their cashflow and aim for optimal management of your liquidity
  • People looking for lower monthly payments to save for home renovations and improve property value
Is this flexible payment product for you?

If you have any questions regarding MERIX products or services, we encourage you to contact Your Ottawa Mortage – The Wilson Team your mortgage expert. If you need to speak with a mortgage expert call: 1-613-695-9250 or Email Kelly at or Visit Website Now

You deserve flexibility. The Possibilities Are Endless…

Jane is a successful doctor who owns her own practice and Lance is a teacher. They can afford a traditional mortgage based on their annual income and savings but they accumulated $58,000 in student loans debt which is currently at an interest rate of 6.8%. Jane and Lance decided to purchase a home using the Interest-Only Flex Mortgage with an ARM rate of Prime plus 0.50% to keep payments as low as possible. With the extra cash flow saved, they are paying down the more expensive student loans with the goal of eliminating the debt by the time their 5-year term is completed.

Sue is a recently divorced Mom. She wants to keep the family home for a few more years until her kids finish high school. Sue refinanced her home to pay out her ex-husband and, because cash flow is tighter now that she is divorced, an interest-only payment made sense. Sue decided to select a Fixed interest-only term to ensure stable and predictable interest payments.

Fred works in the Alberta Oil Sands. He earns good wages but his income fluctuates based on the amount of work and overtime available. Fred purchased a home in Edmonton to live in when he isn’t in the Oil Sands. He took the Interest-Only Flex because he can make the lower required payment even in slower months, then when cash flow is good, he can pay extra as a lump sum payment and designate that toward the principal. Essentially, Fred is still paying down his mortgage but on a schedule that fits his irregular cash flow.

Dylan is a young investor purchasing his first rental duplex in Winnipeg. He has worked hard to save the required down payment but is concerned the typical monthly P&I mortgage payment might be challenging should there be any unexpected vacancies or expenses. Dylan decided to purchase the rental using the Interest-Only Flex with a combination of an interest-only ARM payment and a Fixed amortizing payment. This combination payment gives him the opportunity to use the extra cash-flow to build a large emergency fund while also ensuring he is increasing the equity into the property by paying down some of the principal balance.

As with any mortgage transaction, purchasing or refinancing into the Interest-Only Flex Mortgage requires thought and discussion. We at Your Ottawa Mortgage – The Wilson Team will be an important resource to ensure that you receive professional advice and council on the suitability of this product as you moved forward with your mortgage financing needs.