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Orange County real estate is expensive. Interest-only loans give buyers a way to get into Tustin without maxing out monthly cash flow.
These loans work best for borrowers with irregular income — investors, business owners, and commission-based earners who want payment flexibility.
700+
Typical Min Credit Score
20%
Min Down Payment
5–10 Years
Interest-Only Period
Non-QM
Loan Classification
12+ Months
Reserves Typically Required
Interest-Only Loans in Tustin
Interest-only loans are non-QM products. That means stricter lender overlays, not looser ones — expect a 700+ credit score requirement at most lenders.
Down payments typically start at 20%. Lenders want significant equity from day one on these structures.
Local decision guide
Use this guide to connect interest-only loans eligibility, lender expectations, and local market factors before comparing payment options in Tustin.
Orange County real estate is expensive. Interest-only loans give buyers a way to get into Tustin without maxing out monthly cash flow.
These loans work best for borrowers with irregular income — investors, business owners, and commission-based earners who want payment flexibility.
Interest-only loans are non-QM products. That means stricter lender overlays, not looser ones — expect a 700+ credit score requirement at most lenders.
Most retail banks won't touch interest-only right now. These loans live in the wholesale and non-QM channel — that's exactly where we operate.
We work with 200+ wholesale lenders. That matters here because interest-only guidelines vary wildly between lenders on rate, term, and qualification.
The interest-only period typically runs 5 to 10 years. After that, your payment resets — and it jumps. Plan for that before you sign.
Most borrowers using these loans intend to sell or refinance before the IO period ends. Have a real exit strategy, not just a hope.
A conventional loan builds equity from payment one. An interest-only loan does not — you're not paying principal during the IO period.
Compared to ARMs, interest-only loans share some structure. Many IO loans are also adjustable, so rate risk compounds after the fixed period.
Tustin's Old Town and Tustin Legacy areas attract buyers who want lifestyle without locking up capital. Interest-only fits that profile well.
Orange County's price points push many buyers into jumbo territory. Interest-only jumbo combinations are common here and require careful lender matching.
Most lenders want 700 or higher. Some non-QM lenders go lower, but expect tighter terms.
Not from payments during the IO period. Equity only grows if the property value increases.
Typically 5 to 10 years. After that, the loan fully amortizes and payments increase significantly.
Yes. Investors often use IO loans to maximize monthly cash flow. DSCR options may also apply.
Generally yes. Non-QM products carry a rate premium. Rates vary by borrower profile and market conditions.
Your payment resets to include principal. That increase can be substantial — plan your exit early.