Graduated Payment Mortgages

A graduated payment mortgage starts with lower monthly payments that increase gradually over time — designed for borrowers whose income is expected to grow.

Apply Now Talk to a Loan Officer

Benefits of a Graduated Payment Mortgage

GPMs are structured to match your payment growth with your expected income growth over time.

Lower initial monthly payments in the early years

Payments increase gradually as income typically grows

Easier to qualify based on initial lower payment

Useful for borrowers expecting income growth over time

Structured payment schedule known upfront

Available as a government-backed GPM program

Negative amortization options available on select programs

Good fit for recent graduates or early-career professionals

How It Works

Payments increase annually for a set period, then level off for the remainder of the loan.

Years 1–5Payments start below a standard fully amortizing payment and increase by a set percentage each year (typically 2.5%–7.5% annually).

Years 6–30Payments level off at a fixed amount for the remainder of the loan term, fully amortizing the outstanding balance.

Negative AmortizationIn some GPM structures, early payments may not cover all accruing interest. The unpaid interest is added to the loan balance — this is called negative amortization. Not all GPMs work this way; ask us which structure applies.

Who Is This Best For?

Graduated payment mortgages work best for borrowers who are confident their income will increase — such as recent graduates entering a high-earning profession, or professionals early in their career. If income growth is uncertain, a standard fixed-rate loan may be a safer choice.

Let's Find the Right Loan for You

Our loan officers will walk you through all your options and help you decide if a graduated payment mortgage fits your financial plan.

Start Your Application Contact Us