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Interest-only loans let you pay just the interest for the first several years. Your principal balance doesn't drop during that period — but your monthly payment is significantly lower.
Rancho Cordova attracts investors and self-employed buyers who need payment flexibility. An interest-only structure can make sense when your income is variable or you're holding a property short-term.
680+
Min Credit Score
20–30%
Down Payment
5 or 10 Years
IO Period
Non-QM
Loan Category
6–12 Months
Cash Reserves
Interest-Only Loans in Rancho Cordova
These are non-QM loans. Lenders set their own rules, and standards are stricter than conventional financing. Expect to show strong assets, solid income, and a credit score above 680.
Most lenders require 20–30% down for interest-only. A low down payment won't cut it here. Reserves — often 6–12 months of payments in the bank — matter a lot to underwriters.
Local decision guide
Use this guide to connect interest-only loans eligibility, lender expectations, and local market factors before comparing payment options in Rancho Cordova.
Interest-only loans let you pay just the interest for the first several years. Your principal balance doesn't drop during that period — but your monthly payment is significantly lower.
Rancho Cordova attracts investors and self-employed buyers who need payment flexibility. An interest-only structure can make sense when your income is variable or you're holding a property short-term.
These are non-QM loans. Lenders set their own rules, and standards are stricter than conventional financing. Expect to show strong assets, solid income, and a credit score above 680.
Your local bank almost certainly doesn't offer this. Interest-only products live in the wholesale and private lending space. That's exactly where SRK CAPITAL operates.
We work with 200+ wholesale lenders, and not all of them offer interest-only programs. We know which ones do — and which ones actually close these deals cleanly in Sacramento County.
I see this loan used two ways in Rancho Cordova. Investors use it to maximize monthly cash flow on a rental. High earners use it to buy more property while keeping payments manageable.
The risk is real though. Once the interest-only period ends — usually after 5 or 10 years — your payment jumps. You're now paying principal and interest on the full balance. Plan for that before you sign.
A DSCR loan is often a cleaner fit for rental investors. It qualifies based on the property's rent income, not yours. Interest-only and DSCR can be combined — that's where cash flow gets aggressive.
An ARM (adjustable-rate mortgage) also starts with lower payments. But an ARM adjusts your rate over time. An interest-only loan adjusts your payment structure. These are different risks — know which one you're taking.
Rancho Cordova has a strong rental market driven by Sacramento's job base in government, tech, and healthcare. Investors targeting that tenant pool often want the payment flexibility interest-only provides.
As of April 2026, Sacramento County remains a competitive market for investors. Getting your payment structure right from day one matters when margins are tight.
Typically 5 or 10 years, depending on the loan structure. After that, payments reset to include principal and interest on the full balance.
Yes. Investors commonly use this structure to improve monthly cash flow. Pair it with a DSCR program for the strongest investor setup.
Not through your payments — no principal is paid down. You only gain equity if the property appreciates in value.
Most lenders want 680 or above. Some go higher depending on the loan size and down payment. Rates vary by borrower profile and market conditions.
Some lenders offer it for primary homes, but most interest-only programs are geared toward investment or second properties. Options are limited for owner-occupied use.
Interest-only products aren't everywhere. We know which of our 200+ wholesale lenders offer them and which ones close smoothly in Sacramento County.