Question 1

Who qualifies for an interest-only loan in Pacific Grove?

Accepted Answer

High-credit borrowers with strong assets and 20%+ down are the target profile. Variable-income earners — self-employed, doctors, investors — are the most common applicants.

Question 2

What happens when the interest-only period ends?

Accepted Answer

Your payment increases because you start repaying principal. Borrowers should plan to refinance, sell, or absorb the higher payment before closing.

Question 3

Are interest-only loans available for second homes here?

Accepted Answer

Yes, but lender options narrow for second homes. Expect tighter reserve requirements and a more detailed review of your overall financial picture.

Question 4

What credit score do I need?

Accepted Answer

Most lenders want 700 or above for interest-only products. Some non-QM lenders go lower, but pricing gets worse fast below that threshold.

Question 5

Can I use an interest-only loan for a Pacific Grove vacation rental?

Accepted Answer

You can, but investor-use properties often require larger down payments and more reserves. A DSCR loan may actually price out better for rental scenarios.

Question 6

How do interest-only rates compare to conventional rates?

Accepted Answer

They run higher — these are non-QM products. Rates vary by borrower profile and market conditions, so get quotes and compare carefully.

Interest-Only Loans in Pacific Grove, CA