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Interest Only


Interest only loan programs provide the same features as fixed and variable rate programs, and they additionally offer a lower payment option. With an interest only loan payment option, you pay only the interest portion of the payment but no principal.

Loan Program Advantages Disadvantages
Interest Only Programs
  • Several payment options
  • Lower monthly payments
  • Qualify for a higher loan amount
  • Qualify at the interest only payment
  • Option to pay the full principal and interest payment
  • Interest only payments for up to ten years
  • Higher rates
  • Principal loan balance will not decrease during the interest only payment period
  • Payment will be higher for the remaining term

An interest only loan can be more expensive compared to a fully amortized loan. Many lenders add a fee of one-quarter point for the interest only option.

Interest only payment options allow you to qualify at the starting interest only payment. This gives you more buying power and a lower monthly payment compared to an amortized loan.

You pay interest based on your principal balance. On an interest only loan, your principal balance does not decrease, therefore, you pay more interest with this option.



Processing Center - 3695 Stanford Dr. - Lake Havasu City, AZ 86406
Office Phone: 928-566-4257 Fax: 928-566-4258
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We lend in the following states: AZ, CA

Corporate Office: 10251 Vista Sorrento Pkwy., Suite 350, San Diego, CA 92121 Cobalt is licensed by the California Dept of Real Estate, Broker # 01821025.

Regional Office: 8149 N 87th Place, Suite 204, Scottsdale, AZ 85258 Arizona Broker License # BKBR 0115181

David Herring is licensed by the California Dept of Real Estate, License # 01193746.

Loan approval is not guaranteed and is subject to lender review of information. Loan is only approved when lender has issued approval in writing. Specified rates may not be available for all borrowers. Rate subject to change with market conditions.



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