Question 1

What happens when my interest-only period ends?

Accepted Answer

Your payment converts to fully amortizing over the remaining term. Expect a 40-50% payment increase unless you refinance or sell before conversion.

Question 2

Can I pay principal during the IO period?

Accepted Answer

Yes, most IO loans allow extra principal payments without penalty. You control when and how much to pay down the balance.

Question 3

Do interest-only loans work for investment properties in Foster City?

Accepted Answer

Absolutely. Investors use IO loans to maximize cash flow and leverage. DSCR programs pair well with IO structures for rental properties.

Question 4

How much higher are IO loan rates compared to conventional?

Accepted Answer

Expect 1-2% higher rates since these are non-QM products. Rates vary by borrower profile and market conditions.

Question 5

Can I qualify using stock options or unvested RSUs?

Accepted Answer

Some lenders count vested RSUs as reserves. Unvested equity typically doesn't qualify, but asset depletion programs offer workarounds.

Interest-Only Loans in Foster City: Lower Payments for Tech Earners and Investors