An intermediate-term mortgage is one that has an agreed time frame of up to 20 years. There are set legal limits on interest rates that can be charged in an intermediate-term mortgage and in some cases, borrowers are not allowed to borrow more than an amount that can be covered in an intermediate term. This amount would vary from state to state.
An intermediate-term mortgage is the most popular type of mortgage, and allows for an agreement on interest rates to be made relating to the current or future set rates.
There are many years of payments that are based on interest only within an intermediate-term mortgage, which makes them valuable to lenders.