Interest-Only HELOC Options
Make interest-only payments during the interest-only payment period of your home equity line, then pay principal and interest for the rest of the term. Lines start at $20,000 on at least one program.
What an interest-only HELOC can do
Here is what our interest-only HELOC programs allow, taken from the guidelines we lend under.
- Line amounts start at $20,000 on at least one program and reach $1,000,000 on another.
- The line can sit in first or second lien position.
- Primary residences, second homes and investment properties are eligible on at least one program.
- Credit scores start at 600 on at least one program, with a 45% debt-to-income cap for scores from 600 to 679.
- Debt-to-income can go up to 50% on several programs.
- Several programs carry no prepayment penalty.
Interest-only payments while you draw
Draw again after 90 days
Bank statements can document income
No minimum reserves on some lines
No ownership wait for primary homes
Can follow an interest-only mortgage
How Interest-Only HELOCs Work
One line of credit, two payment stages, and a qualifying rule that looks past the interest-only payment.
A HELOC is a home equity line of credit. With an interest-only payment period, the required payment during that period covers interest only. After it ends, principal and interest are amortized over the remaining term. The interest-only HELOCs we offer are variable-rate lines.
A large part of the line is drawn at closing. Several programs require an initial draw of 75% of the line, and at least one requires only 50%. On at least one program, lines under $50,000 are fully drawn at closing. After a 90-day wait, you can draw again in amounts of $1,000 or more.
Several of our programs qualify you on a fully amortized payment based on the full line amount, not on the interest-only payment. Your debt-to-income ratio is measured with that payment and can go up to 50% on several programs.
Why choose Saxton for an interest-only HELOC
This page is for homeowners who want a home equity line with an interest-only payment period on a primary home, second home or rental.
We Compare Several Lenders
We place HELOCs with several lenders, so we can match your line amount, credit and property to the program that fits.
Small Lines Are Welcome
At least one program starts at $20,000. On that program, lines under $50,000 are fully drawn at closing.
Larger Lines Are Possible
At least one first lien HELOC with an interest-only payment period goes up to $3,000,000. Lines above $2,000,000 on that program need a credit score of 720 or higher and 12 months of reserves.
Self-Employed Income Counts
At least one program accepts 12 or 24 months of personal or business bank statements. Another verifies income through Plaid or The Work Number.
Second Homes And Rentals Qualify
Second homes and investment properties are eligible on several interest-only programs. For an investment property, at least one program requires a borrower on title for at least 6 months before applying.
Draws By Check Or Phone
At least one program allows unlimited draws during the draw period by check or phone request. Draws start after a 90-day lockout and must be at least $1,000.
Hear From Homeowners Like You
Frequently Asked Questions
Straight answers on how an interest-only HELOC qualifies, draws and repays.
It is a home equity line of credit with an interest-only payment period. During that period, the required payment covers interest only. After it ends, principal and interest are amortized over the remaining term.
On a fully amortized payment. Several of our programs qualify you using a fully amortized payment based on the full line amount, not the interest-only payment. Debt-to-income can go up to 50% on several programs.
600 on at least one program. On that program, scores from 600 to 679 are capped at a 45% debt-to-income ratio. Other programs start at 640 or 660.
Yes. Several programs allow investment properties and second homes. At least one requires a borrower to have been on title for at least 6 months before applying for an investment property line.
It can work. At least one first lien HELOC with an interest-only payment period allows purchase transactions, with 100% of the line drawn at closing. That program is not available in Texas.
It can. At least one program accepts an interest-only first mortgage and qualifies it on a fully amortizing payment. Some programs do not allow an interest-only first mortgage, so we check yours before you apply.
It can be, for a primary residence. At least one program offers an interest-only HELOC in Texas, but second homes and investment properties are not permitted there. Additional draws on that program start at $4,000.
Saxton Mortgage does. At least one HELOC program we offer starts with an interest-only payment period before the line moves to principal and interest payments.
Find out what you qualify for
Tell us about your home, the line amount you want and how you plan to use the interest-only payment period, and we will check how it fits our programs.
Get Pre-Qualified- Consumer Financial Protection Bureau, home equity loan compared with a HELOC
- Consumer Financial Protection Bureau, mortgages
Loan amounts, rates, terms, and eligibility are subject to credit approval, asset and income verification, appraisal, and program guidelines. Program availability varies by state. Not all applicants will qualify. Saxton Mortgage, LLC is an Equal Housing Lender.