Question 1

How long can I pay interest-only in Chico?

Accepted Answer

Most lenders offer 5, 7, or 10-year interest-only periods. After that, payments increase to cover principal over the remaining loan term.

Question 2

What happens when the interest-only period ends?

Accepted Answer

Your payment jumps to cover principal plus interest over the remaining years. Many borrowers refinance or sell before this happens.

Question 3

Can I pay principal during the interest-only period?

Accepted Answer

Yes, most loans allow extra principal payments without penalty. You're not required to, but you can pay down the balance anytime.

Question 4

Do interest-only loans work for owner-occupied homes in Chico?

Accepted Answer

Yes, though lenders scrutinize these more than investor properties. You need strong credit and reserves to qualify for owner-occupied interest-only.

Question 5

What's the minimum down payment for interest-only in Butte County?

Accepted Answer

Expect 20-30% down. Higher down payments sometimes unlock better rates or longer interest-only terms with specialized lenders.

Interest-Only Loans in Chico: Lower Payments for Investors and High Earners