Question 1

What happens after the interest-only period ends?

Accepted Answer

The loan recasts and you start repaying principal. Monthly payments increase, sometimes significantly.

Question 2

Can I use rental income to qualify?

Accepted Answer

Some IO lenders allow it. A DSCR loan may be a better fit if rental income is your primary qualifier.

Question 3

Is fire insurance required in Lake County?

Accepted Answer

Yes. Lenders require it, and coverage can be hard to find in high-risk zones. Check availability early.

Question 4

Do interest-only loans have fixed rates?

Accepted Answer

Some do, some don't. Fixed-rate IO products exist but are less common. Ask your broker what's available.

Question 5

How much do I need to put down in Lakeport?

Accepted Answer

Most IO lenders require 20-30% down. Rural properties sometimes require more depending on the lender.

Question 6

Why can't I get this loan at my local bank?

Accepted Answer

Most retail banks exited this space after 2008. Non-QM wholesale lenders are where these products live now.

Interest-Only Loans in Lakeport, CA