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Interest-Only Loans in Exeter
Exeter's agricultural economy creates income patterns that don't always match traditional mortgage structures. Harvest timing, seasonal revenue, and investment property cash flow make interest-only periods useful for many borrowers here.
These loans work best when you expect income growth, plan to sell within the interest-only term, or need maximum cash flow flexibility. Central Valley real estate appreciation historically rewards this strategy when timed correctly.
Most interest-only loans require 680+ credit scores and 20-25% down payments. This is non-QM territory, which means lenders price for risk and expect strong overall profiles.
You'll need documented reserves—typically 6-12 months of payments. Self-employed borrowers using bank statements or P&L statements qualify regularly, which matters in a city where farm ownership and small business income dominate.
Interest-only programs live in the non-QM space, where each lender writes their own guidelines. Some cap at $2 million, others go higher. Some allow 5-year interest-only terms, others max at 10 years.
Shopping this loan type requires comparing not just rates but term length, prepayment penalties, and what happens when the interest-only period ends. Those details swing your total cost by tens of thousands.
I see two types of Exeter borrowers use these successfully: investors managing rental portfolios across Tulare County, and high-income professionals who understand arbitrage and plan to refinance or sell before principal payments start.
The mistake I see most often is treating interest-only like a long-term solution. It's a timing tool. You need a clear plan for year 6 or year 11 when that payment jumps 40-60% and principal amortization begins.
Compared to a standard 30-year fixed, you'll pay significantly less monthly during the interest-only period but build zero equity through payments. ARMs offer lower rates but don't give you the same cash flow relief.
DSCR loans make more sense for pure rental properties in Exeter. Interest-only fits better when you're managing cash flow across a business or farm operation while holding real estate as part of a broader wealth strategy.
Exeter's citrus and olive operations generate lumpy income that fits interest-only structures. Growers can match debt service to revenue cycles and keep working capital in their operations instead of locked in home equity.
Property values here move with agricultural economics and Central Valley growth patterns. If you're betting on continued demand from Bay Area transplants and Tulare County development, interest-only lets you leverage that appreciation without overextending monthly budgets.
Your payment jumps to cover both interest and principal over the remaining loan term. On a 30-year loan with 10 years interest-only, you'll amortize over 20 years, increasing payments 40-60% typically.
Yes, through bank statement or P&L programs common in non-QM lending. Most lenders average 12-24 months of deposits or profit and loss statements to determine qualifying income.
They can, but DSCR loans often make more sense for pure rentals. Interest-only fits better when managing multiple properties or combining rental income with business operations.
Expect 20-25% down as standard. Some programs allow 15% down with strong credit and reserves, but most lenders price more aggressively below 20% equity.
Yes, typically 1-2% higher since these are non-QM products priced for flexibility. Rates vary by borrower profile and market conditions based on credit, equity, and reserves.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Non-QM mortgages that use a CPA-prepared profit and loss statement to verify income for self-employed borrowers.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.