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A loan that includes an interest-only period during the first five years of a 30-year term would be classified as which of the following?

General Mortgage Knowledge · 20% of the SAFE exameasy

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Correct answer: A Non-QM loan

Interest-only loans are explicitly prohibited from receiving Qualified Mortgage status under any QM category. A QM loan must have payments that fully amortize the loan over the loan term and cannot have interest-only periods. Because interest-only structures are a disqualifying feature, any loan with this characteristic is automatically a Non-QM loan, regardless of the lender's size or the loan's other characteristics.

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