Question 1

What happens after the interest-only period ends?

Accepted Answer

Your payment jumps as you start paying principal on the remaining balance. Model this before you buy — the increase can be significant on a San Jose-sized loan.

Question 2

Do I build any equity during the interest-only period?

Accepted Answer

Only through appreciation. You pay zero principal during that initial period. If prices drop, you could owe more than the home is worth.

Question 3

Can I use this loan for a San Jose investment property?

Accepted Answer

Yes, but DSCR loans often work better for rentals. Interest-only is strongest for primary homes or second properties where cash flow control matters.

Question 4

What credit score do I need for interest-only in Santa Clara County?

Accepted Answer

Most lenders want 700 or higher. Some go to 680 with stronger reserves. This is non-QM — each lender sets its own floor.

Question 5

Is interest-only a good fit for RSU income earners?

Accepted Answer

Often yes. Lower monthly payments let you redirect cash at vest cycles. Talk to us about how your comp schedule affects qualification.

Question 6

How long is the interest-only period?

Accepted Answer

Typically 5 or 10 years depending on the loan structure. After that, the loan recasts and you pay principal plus interest for the remaining term.

Interest-Only Loans in San Jose, CA