Negative amortization mortgages are basically a kind of adjustable rate mortgage. This means that rate of interest and your loan repayment can change every month. The negative amortization loans usually have low monthly payments and are more flexible.
As you have already understood, negative amortization loan has a few benefits. Several home owners opt for this because the monthly payments are lower than other types of loans and this makes additional interest payment possible. Moreover you will get the flexibility of deciding on lower or higher payments according you what you can afford. Moreover people qualify for negative amortization loans more easily than other kinds of loans.
However, the downside of negative amortization loan is if you pay the minimum payment due every month you stand the chance of losing equity in your property. Another drawback of negative amortization loan is you are likely to owe more money at the end of a month compared to what you did at the start of a month.
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