Zero-Coupon Mortgage

You pay nothing. Until you pay it all.

Sounds like the tag line to a testosterone-y mobster flick, right? Well...it's not.

You take out, say, $300,000 in a mortgage at 5% interest. You owe literally nothing along the way on principal, no payments on interest, not even heartfelt love to the bank for affording you this lovely new home.

The catch? Not only is the principal due in 15 years, but the interest on it, compounded, is due at the end as well. So you'll owe the bank a check for something in the neighborhood of $700,000 at the end, all in one swell foop. Or you can hand them over the keys to the home as you move out.

Sounds risky for the lender, right? They don't like repo-ing homes. So then what do they do? They charge you a much higher rate of interest than they would a normal "conforming" mortgage taker who pays down a tiny bit of the principal each month so that there isn't a big fat smoking hole in the ground at the end.