Some Connecticut buyers and owners expect a large future sum, such as proceeds from selling a business or another property, and want to keep cash available until it arrives. An interest-only mortgage can fit that plan, but it carries real risks: your balance does not shrink unless you pay extra, the payment rises later and your equity depends on the home's value. Eligibility varies by borrower, property and investor, and any loan is subject to credit approval.
Call to talk with a licensed loan officer. Programs vary by borrower, property and investor.
Mortgage lenders, brokers and loan originators serving Connecticut are licensed by the Connecticut Department of Banking, Consumer Credit Division. Non-QM loans are made by the same licensed lenders and brokers, so you can confirm any company's or loan officer's license on NMLS Consumer Access before you apply.
Where the numbers point in Connecticut
Counties with the most first liens with an interest-only feature (2024):
| County | First liens with an interest-only feature (2024) |
|---|---|
| the Western Connecticut Planning Region | 459 |
| the Capitol Planning Region | 77 |
| the Northwest Hills Planning Region | 60 |
| the Southeastern Connecticut Planning Region | 53 |
| the Greater Bridgeport Planning Region | 51 |
| the Lower Connecticut River Valley Planning Region | 45 |
| the Naugatuck Valley Planning Region | 39 |
| the South Central Connecticut Planning Region | 33 |
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Prefer to talk first? Call (888) 508-8976. Applying is not a loan approval or commitment to lend; programs vary by borrower, property and investor. ClearPoint Mortgage Advisors, NMLS #173855. Properties in FL, NY, NJ, PA, CT and VA only.
Local pages in Connecticut
- Non-QM lenders in Bridgeport
- Non-QM lenders in Hartford
- Non-QM lenders in New Haven
- Non-QM lenders in Norwich
- Non-QM lenders in Waterbury
- Non-QM lenders in Danbury
- Non-QM lenders in Stamford
- Non-QM lenders in Norwalk
- Non-QM lenders in New Britain
- Non-QM lenders in Bristol
- Non-QM lenders in Meriden
- Non-QM lenders in West Haven
- Non-QM lenders in Milford
- Non-QM lenders in Milford city
- Non-QM lenders in Middletown
- Non-QM lenders in Shelton
- Non-QM lenders in Torrington
- Non-QM lenders in Naugatuck
- Non-QM lenders in New London
- Non-QM lenders in Ansonia
- Non-QM lenders in Wallingford Center
- Non-QM lenders in Willimantic
- Non-QM lenders in Storrs
- Non-QM lenders in Derby
- Non-QM lenders in Conning Towers Nautilus Park
- Non-QM lenders in Jewett City
- Non-QM lenders in Oakville
- Non-QM lenders in Thompsonville
- Non-QM lenders in Riverside
- Non-QM lenders in Kensington
Common questions
What is an interest-only mortgage?
An interest-only mortgage is a loan where the required payments cover only interest for an initial period. Your balance does not go down during that time unless you pay extra. After the interest-only period, the loan amortizes and payments include principal and interest, which raises the payment. The feature is offered on non-QM loans because Qualified Mortgage rules exclude interest-only payments.
Do I build equity with an interest-only loan?
Only through a rise in the home's value or extra principal payments you choose to make. Required payments during the interest-only period do not reduce what you owe. If values fall, you could owe close to or more than the home is worth, which makes selling or refinancing harder. Plan for that possibility rather than counting on appreciation.
What happens when the interest-only period ends?
The loan starts amortizing. Your remaining balance is spread over the rest of the term, so each payment now includes principal as well as interest, and the payment goes up. If the rate is adjustable, it may change too. Many borrowers plan to pay down the balance, refinance or sell before or at that point, but none of those outcomes is certain.
Other non-QM options in Connecticut
Bank statement loansNon-QM lendersSelf-employed1099 loansP&L loansAsset depletionNo-doc / stated incomeNew self-employedITIN loansForeign nationalNon-warrantable condoBank statement HELOC
Related guides
- QM vs. Non-QM Loans: What the Difference Means for You
- How to Compare Non-QM Loan Offers: Loan Estimates, Features and Fit
- What Is a Non-QM Loan?
Interest-Only Mortgages overview · Connecticut non-QM overview
- 2024 HMDA data