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A friend of mine got one of those "interest only" loans a few years ago and I thought he was an idiot. Then he told me he claims single/zero on his taxes, and since his payments are all interest...at the end of the year he gets a check for about $12,000. He has the discipline to use that check to pay down the principle of the house. Doing it this way, his payments are lower, and he's actually paying the house off faster than a conventional loan.
It does take a lot of discipline though. When you've got a big fat check like that in your hand, a lot of other ways to spend it must pop into your head.
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"I'm completely in favor of the separation of Church and State. My idea is that these two institutions screw us up enough on their own, so both of them together is certain death."
- George Carlin
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