Question 1

What happens when my interest-only period ends in Sierra Madre?

Accepted Answer

Your payment increases 40-60% as principal kicks in. Most borrowers refinance or sell before this happens, using home appreciation to improve loan terms.

Question 2

Can I make principal payments during the interest-only period?

Accepted Answer

Yes. Most lenders allow extra principal payments without penalty. This gives you flexibility to reduce balance when cash flow allows.

Question 3

Why do interest-only rates run higher than conventional loans?

Accepted Answer

These are non-QM products with higher lender risk. No principal paydown means less equity cushion if values drop.

Question 4

Do interest-only loans work for investment properties in Sierra Madre?

Accepted Answer

Yes, but DSCR loans often work better for pure rentals. Interest-only fits best for owner-occupied or short-term investment plays.

Question 5

How much can I borrow with an interest-only loan here?

Accepted Answer

Most lenders cap at $2-5M depending on credit and down payment. Sierra Madre's price range fits well within these limits.

Interest-Only Loans in Sierra Madre: Smart Cash Flow for High-End Buyers