Interest-Only Mortgage

An interest-only mortgage lets you pay only the interest for a set period, often 10 years, which keeps early payments low. It is a planning tool for borrowers with strong assets or variable income.

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What is an Interest-Only Mortgage?

With an interest-only loan, payments during the initial period cover interest only, so the loan balance does not go down unless you pay extra. After the interest-only period, payments reset to include principal over the remaining term, which increases the payment. These are usually offered as jumbo or non-QM loans.

Lower early payments

Pay interest only for an initial period.

Cash-flow flexibility

Free up money for investing or business needs.

Pay principal anytime

Extra payments reduce your balance and future payment.

Jumbo and investor options

Available on higher loan amounts and rentals.

Is an Interest-Only Mortgage right for you?

Who it is for

Borrowers with variable or commission income
Investors focused on cash flow
High-net-worth buyers with strong assets

Benefits

Lower payment during the interest-only period
Frees up cash for investing or business needs
You can still pay principal whenever you want

Things to consider

No equity is built through payments during the interest-only period
Payment rises when amortization starts
Usually a non-QM or jumbo product with higher down payment and reserve requirements

Everything about the Interest-Only Mortgage

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How the payment changes Who it is for Typical requirements How the interest-only period works Interest-Only Mortgage FAQs

How the payment changes

After the interest-only period ends, the full balance is paid off over the remaining years, so the new payment can be significantly higher. We will show you both payments before you apply.

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Who it is for

Interest-only loans fit borrowers with substantial assets, commission or bonus income, or investors focused on cash flow. They are not a way to afford more house than your long-term budget allows.

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Typical requirements

Expect stronger credit, larger down payments and meaningful reserves compared with standard loans. Terms vary by lender.

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How the interest-only period works

A typical structure is 10 years of interest-only payments followed by 20 years of fully amortizing payments. When the second phase starts, the payment can rise significantly because the full balance is paid over a shorter time.

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How to apply

1
Request a call back
Tell us about your goals. A loan officer will confirm whether this program is the right fit.
2
We prepare the application
We fill out the application with you and send a secure list of documents to upload.
3
Approval and closing
We handle appraisal, underwriting and title, keeping you updated by phone, text or email.

Documents to have ready

Income documentation or alternative documentation for non-QM programs
Asset and reserve statements
Credit review

Every file is different. Your loan officer will send an exact list.