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10 Best Interest-Only Mortgage Lenders of 2026
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10 Best Interest-Only Mortgage Lenders of 2026

Kate Wood
Jeanette Margle
Kate Wood
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Written by 

Kate Wood

,  Edited by 

Jeanette Margle

Written by 

Kate Wood

 and 
1 other
Last updated 05/19/2026
Need a short-term mortgage? If you need funding now and can pay off the loan in 10 years or less, you may be drawn to an interest-only mortgage. You won’t find this niche product at every lender — here are NerdWallet's top-scoring interest-only mortgage lenders.
 

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What is an interest-only mortgage?

An interest-only mortgage requires payments of just the interest for the first years of the loan. You’re not paying back any of the borrowed money (the principal) yet. The interest-only period on these loans can last as long as 10 years.
Many interest-only mortgages are jumbo loans. These super-sized loans are for higher-priced properties that don't meet conventional loan standards.
Interest-only home loans are often structured similarly to adjustable-rate mortgages, with two distinct phases. During the initial phase, the interest rate is fixed — and you're only paying for the interest. Those extra-low monthly payments are arguably an interest-only loan's biggest plus.
Since you're only paying interest, your principal remains the same. On one hand, it's not getting bigger, but on the other hand, it's not shrinking either, so you aren't building home equity.
Once that term ends, you enter the amortization phase. As with a regular ARM, in this second phase the loan's rate will begin to adjust up or down based on prevailing mortgage rates. With an interest-only loan, the biggest difference transition isn't the new interest rate — it's that you'll now be on the hook for paying the principal and interest, which can mean significantly higher monthly payments. (One plus, now you'll finally start growing your equity.)
Even if your interest rate moved lower, the principal payments kicking in will be a big increase. You may also be repaying the principal on an abbreviated timeline. If your 30-year interest-only loan had a 10-year interest-only period, for example, you've now got just 20 years to repay the entire principal.
However, most borrowers who get an interest-only mortgage do so because they intend to pay off the loan or refinance to a different type of mortgage before the interest-only period ends.
» MORE: Best adjustable-rate mortgage lenders
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Best for mortgage lending overall

Truist

NMLS#399803

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

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Our take on Truist

The Nerdy headline

If you prefer people to tech, Truist might be a good fit for you. Preapproval and customer care happen mostly offline, and for details on less-common loan types or custom rates you'll need to talk to a person.

What we like
  • Offers a wide range of mortgage options focused on affordability.
  • Convenient online application.
  • Generous grants for qualifying home buyers in select locations.
What we don't like
  • Getting custom rates and applying for mortgage preapproval both require human contact.
  • Customer care leans heavily on phone and in-person service.
  • HELOCs are not available in most states, though home loans are available everywhere in the U.S. except Alaska, Arizona and Hawaii.
Read our full review of Truist

Best for low combined rates and fees

PNC Bank

NMLS#446303

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

GET MY RATE

Our take on PNC Bank

The Nerdy headline

PNC Bank offers a wide selection of loans and refinance options, with a streamlined digital experience and comprehensive rates tool.

What we like
  • Solid variety of mortgage types, both standard and harder-to-find.
  • Online rate quotes are informative and easy to customize.
  • Offers down payment grants and no-PMI loans for low-income borrowers.
What we don't like
  • Mobile app has limited mortgage features.
  • In-person service not available in all states.
  • Construction loans are only available in AL, AZ, CA, CO, FL, GA, NJ, NM, NC, OH, PA, SC, TN, TX, VA and WA.
Read our full review of PNC Bank

Best for first-time home buyers

Flagstar

NMLS#417490

NerdWallet rating

5.0

Home loans overall
Min. credit score

600

Min. down payment

3%

GET MY RATE

Our take on Flagstar

The Nerdy headline

Flagstar Bank stands out for having a wide variety of home loan options, including harder-to-find products. But take note that Flagstar has reduced its mortgage business as part of corporate restructuring. Executives have indicated that the lender will rebuild its home lending operations by focusing on the needs of banking clients.

What we like
  • Offers down payment assistance programs to borrowers in qualifying areas.
  • Reported average time to close is 25 days, faster than the national average.
  • Conventional loan terms extend to 40 years, which is unusually flexible.
What we don't like
  • You can't apply for preapproval or prequalification online.
  • Customer service options are limited.
Read our full review of Flagstar

Best for online convenience

Network Capital

NMLS#11712

NerdWallet rating

4.5

Home loans overall
Min. credit score

620

Min. down payment

3%

GET MY RATE

Our take on Network Capital

The Nerdy headline

Network Capital stands out for its focus on borrowers with lower credit score, and offering competitive refinance products.

What we like
  • Cash-out refinancing is an uncommon specialty, so Network Capital could appeal to that borrower.
  • Offers HELOCs for homeowners who want to access their equity without refinancing.
What we don't like
  • Home buyers should know the lender doesn’t specialize in purchase loans.
  • Borrowers must be contacted for a quote before completing an online application.
Read our full review of Network Capital

Best for Wells Fargo customers

Wells Fargo

NMLS#399801

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

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Our take on Wells Fargo

The Nerdy headline

Wells Fargo has significantly shrunk its mortgage business in recent years, but still offers a range of government-backed and speciality loans, as well as assistance for first-time home buyers.

What we like
  • Borrowers can see customized mortgage rate estimates online.
  • Offers relatively low interest rates and fees, according to the latest federal data.
  • Discounts may be available for existing Wells Fargo customers.
What we don't like
  • Does not offer home equity loans or HELOCs.
  • Borrowers need at least $250,000 in assets with the bank to qualify for a rate discount.
  • Prospective borrowers may be put off by the lender’s past legal issues.
Read our full review of Wells Fargo

Best for customer experience

U.S. Bank

NMLS#402761

NerdWallet rating

4.5

Home loans overall
Min. credit score

620

Min. down payment

3%

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Our take on U.S. Bank

The Nerdy headline

U.S. Bank offers a broad selection of mortgages, including some niche options. Rates and fees are middle of the road, per federal data. The bank offers helpful tech for rate shopping and live chat, though its online application could be smoother.

What we like
  • Wide variety of mortgages, including some harder-to-find types.
  • Experience in construction and renovation loans.
  • Offers up to $17,500 in assistance (income/location requirements apply).
What we don't like
  • Rates shown online don’t reflect your credit score.
  • Contact form interrupts online application before you can complete it.
  • Few mortgage options for borrowers with low/bad credit.
Read our full review of U.S. Bank

Best for credit union lending

FourLeaf Federal Credit Union

NMLS#449104

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

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Our take on FourLeaf Federal Credit Union

The Nerdy headline

FourLeaf Credit Union, formerly known as Bethpage, is easy to join: Just deposit $5 in a savings account. Its online rates tool lets you estimate monthly payments, but customization is limited.

What we like
  • Nice selection of specialty mortgages.
  • Well rated mobile app.
What we don't like
  • No renovation or construction loans.
  • Online rate quote is light on detail and doesn’t let you customize.
  • Average interest rates are on the higher side, according to the latest federal data.
Read our full review of FourLeaf Federal Credit Union

Best for lower-credit borrowers

Carrington

NMLS#2600

NerdWallet rating

4.5

Home loans overall
Min. credit score

620

Min. down payment

3%

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Our take on Carrington

The Nerdy headline

Carrington Mortgage offers specialty loans for people who might have trouble getting a mortgage elsewhere, like self-employed borrowers or those with heavy debt. However, average rates and fees are higher than competitors.

What we like
  • Considers borrowers with bad credit, foreclosure or bankruptcy.
  • Options for self-employed borrowers and alternative income documentation.
What we don't like
  • Average APR, which measures a combination of rates and fees, is higher than competitors, according to the latest federal data.
  • Rates are posted online, but website navigation is clunky.
  • Offers home equity loans, but no HELOCs.
Read our full review of Carrington

Best for customer satisfaction

Chase

NMLS#399798

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

GET MY RATE

Our take on Chase

The Nerdy headline

Chase mortgage has an above-average reputation for consumer satisfaction, and offers a number of programs that can make home buying more affordable and accessible.

What we like
  • Offers a wide range of loan types, including options with low down payment requirements.
  • Home buyer grants up to $5,000 may apply for qualified borrowers.
  • Receives above-average ratings for customer satisfaction, according to J.D. Power and Zillow.
What we don't like
  • Borrowers must create an account or speak with a home loan expert before completing an online application.
  • Parts of the prequal and preapproval process cannot be done solely online.
Read our full review of Chase

Best for Variety of jumbo loan types

Real Genius

NMLS#2389303

NerdWallet rating

4.5

Home loans overall
Min. credit score

620

Min. down payment

3.5%

GET MY RATE

Our take on Real Genius

The Nerdy headline

Real Genius is a smart pick for a do-it-yourself online quote. We’re impressed with its "no fine print” approach and options to sort and customize APR and fees. However, Real Genius does not have a mobile app and doesn’t currently prioritize home equity lending.

What we like
  • Easy and transparent online rate quote tool.
  • May accept borrowers with low credit scores.
  • Closes loans in an average of 30 days (faster than industry average).
What we don't like
  • Federal data isn’t available for us to objectively compare this lender with others.
  • Home equity loans and HELOCs aren’t a priority.
  • Not currently lending in U.S. territories.
Read our full review of Real Genius
NerdWallet's star ratings for mortgage lenders are awarded based on our evaluation of the products and services each lender offers to consumers who are actively shopping for the best mortgage. The five key areas we evaluated include the variety of loan types and products offered, online conveniences, online mortgage rate information, and the rate spread and origination fee lenders reported in the latest available Home Mortgage Disclosure Act data. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.

How we chose the best interest-only mortgage lenders

Our team of mortgage experts follows an objective, consumer-first methodology to assess home loan lenders and pick the best lenders for interest-only loans.

40+

Lenders reviewed

We review more than 40 lenders, including major banks, credit unions, and online lenders operating across multiple states.

10

Categories assessed

Each lender is evaluated across ten weighted categories covering rates and fees, types of home loans offered, rate transparency and customer experience.

11,000+

Data points analyzed

Our team tracks and reassesses thousands of data points annually for reviewed lenders, ensuring up-to-date, accurate comparisons across multiple loan types.

Star rating categories

We evaluate the following categories and carefully weigh how each factor impacts your experience.
For inclusion in this roundup, lenders must earn 4.5 stars or above according to our home loans overall methodology and must confirm the availability of interest-only loans in NerdWallet’s annual lender survey.
NerdWallet rates mortgage lenders based on what matters most to borrowers: rates and fees, product accessibility, customer experience, rate transparency and the range of loan options.
We review more than 40 lenders and score them using a weighted system that prioritizes affordability and a smooth borrowing experience. Lenders earn higher scores for offering lower borrowing costs, making loans widely available, clearly displaying rate information and supporting borrowers from application through closing.
We use a mix of lender-provided information, publicly available data and our own research and analysis to evaluate each lender. Recent regulatory actions may affect a lender’s score.
Read more about how NerdWallet rates mortgage lenders here.

Is it hard to qualify for an interest-only mortgage?

Interest-only loans are generally harder to qualify for than traditional mortgages. Lenders often require a down payment of 15% or more and a low debt-to-income ratio. Lenders might also require a good-to-excellent credit score for an interest-only mortgages — for example, a FICO score of 680 or higher. Last, lenders may also want to see evidence of substantial assets or cashflow to gauge your ability to successfully repay the loan.

What the nerds think

Is there a downside to an interest-only loan if you're planning to sell or refinance?

Planning to ditch your interest-only loan assumes that the property value will remain stable or increase. While that can feel like a safe bet, real estate's appreciation isn't guaranteed. If home values have decreased in your area and you end up selling for less than the mortgage balance, you’ll have to make up that difference to repay the loan. Likewise, it could be harder to refinance if home values have fallen, since interest-only payments mean your only equity comes from your down payment and you don't have equity built through appreciation.
Kate Wood's profile picture
Kate WoodSenior Writer/Spokesperson

Why get an interest-only mortgage?

Interest-only mortgages aren't a fit for most borrowers, but there are a few scenarios where this type of loan could make sense.
An interest-only mortgage might be a good fit if you don't plan to live in the property for long and want to preserve the cash you'd spend on monthly principal payments for other investments. It's best if you are in a strong financial position and do not need to build home equity. For example, this type of mortgage could make sense if your job requires you to temporarily transfer to a new location and the interest payments cost less than renting.
Other potential candidates for interest-only loans include investors looking to flip houses, people who anticipate receiving a substantial sum from an inheritance or trust, or those who are just starting out in a high-paying field. You may also consider an interest-only mortgage if you have the money to pay off the loan, but it’s tied up in an investing tool (such as a CD or bond) that will mature before the end of the interest-only period.
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