Question 1

Do I ever pay down the loan during the IO period?

Accepted Answer

Not unless you make extra payments. Every required payment goes to interest only. Principal stays flat until the IO period ends.

Question 2

What happens when the interest-only period ends?

Accepted Answer

Payments reset to cover principal plus interest over the remaining term. That jump can be significant — plan ahead.

Question 3

Can I get an interest-only loan on a Hesperia rental?

Accepted Answer

Yes. Investors use IO loans frequently on rentals. A DSCR structure with IO pricing is a common setup.

Question 4

Is an interest-only loan harder to qualify for?

Accepted Answer

Yes. Non-QM guidelines are stricter on reserves and down payment. Credit requirements are also higher than FHA or conventional.

Question 5

Can I refinance out of an IO loan later?

Accepted Answer

Yes. Many borrowers plan to refi before principal kicks in. Your equity position and credit at that time will drive the terms.

Interest-Only Loans in Hesperia, CA