Question 1

How long is the interest-only period?

Accepted Answer

Typically 5 to 10 years. After that, the loan resets to full principal and interest payments for the remaining term.

Question 2

Does IO mean I'm building no equity?

Accepted Answer

During the IO period, yes — payments don't reduce your balance. Equity only grows if property values rise.

Question 3

Can I pay principal during the IO period?

Accepted Answer

Most programs allow it. You're not required to, but extra principal payments reduce your balance and future payment.

Question 4

Is an interest-only loan available for a primary home in Alameda?

Accepted Answer

Yes, but expect tighter credit and reserve requirements than on investment or jumbo purchases.

Question 5

What credit score do I need in Alameda?

Accepted Answer

Most IO lenders want 700 or higher. Some go lower with larger down payments. Rates vary by borrower profile and market conditions.

Question 6

Why use a broker for an IO loan?

Accepted Answer

Retail banks rarely offer these programs. A broker with wholesale access can find options and rates you won't find on your own.

Interest-Only Loans in Alameda, CA