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Folsom attracts high earners — tech workers, executives, business owners. These borrowers often benefit from lower payments now and higher income later.
Interest-only loans fit that profile well. You pay only interest upfront, keeping monthly costs down while your income or assets grow.
700+ typical
Min Credit Score
20% minimum
Down Payment
5–10 years
I/O Period
Non-QM
Loan Category
12 months typical
Reserves Required
Interest-Only Loans in Folsom
Most lenders want a 700+ credit score for interest-only. Some go lower, but expect tighter terms and higher rates.
Down payments typically start at 20%. Lenders also want to see strong reserves — often 12 months of payments in the bank.
Local decision guide
Use this guide to connect interest-only loans eligibility, lender expectations, and local market factors before comparing payment options in Folsom.
Folsom attracts high earners — tech workers, executives, business owners. These borrowers often benefit from lower payments now and higher income later.
Interest-only loans fit that profile well. You pay only interest upfront, keeping monthly costs down while your income or assets grow.
Most lenders want a 700+ credit score for interest-only. Some go lower, but expect tighter terms and higher rates.
Big banks rarely offer these anymore. Interest-only lending lives in the non-QM wholesale space now.
That's where we operate. SRK CAPITAL shops 200+ wholesale lenders — most retail borrowers never see these programs.
The most common mistake: borrowers forget what happens when the interest-only period ends. Payments jump — sometimes sharply.
Plan your exit before you close. Refinance, sell, or make sure your income supports the fully amortized payment.
Compared to a standard 30-year fixed, interest-only saves cash monthly but builds zero equity during the I/O period.
ARMs and DSCR loans are close cousins. If you're buying rental property in Folsom, DSCR might be a cleaner fit.
Folsom sits in Sacramento County with a mix of newer construction and move-up buyers. Loan sizes here often push into jumbo territory.
Interest-only jumbo combos are common in this market. If your loan exceeds conforming limits, this pairing is worth pricing out.
Typically 5 to 10 years. After that, the loan recasts and you pay principal plus interest on the remaining balance.
Only if the property appreciates. You make no principal payments, so your loan balance stays flat.
Yes. Bank statement and asset-based programs pair well with interest-only. Income docs vary by lender.
Most lenders want 700 or above. Lower scores are possible but come with higher rates and stricter terms.
Yes. DSCR and investor-focused non-QM lenders often offer interest-only options on rental properties.
Your payment increases to cover principal plus interest. Budget for that scenario before you close.