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80/5 mortgage loans
sometimes called a Piggy-Back loan, is a program
designed to help Borrower's purchase a home with 15%
down while avoiding Mortgage Insurance. An 80/5 loan is actually 2 mortgage
loans, a 1st mortgage (at 80% of the value of the home)
and a 2nd mortgage (at 5% of the value of the home.)
80/10 loans eliminate the need to pay Private Mortgage Insurance
(also known as PMI) and also generally provide considerably
lower rates than other types of financing. 80/10 financing
helps to keep your payments low and gives you the freedom
of not having to put any money down.
- Choose a fixed rate, 5/1 ARM or 7/1
ARM for 80% of your financing.
- We will attach a second mortgage
to finance the remaining 10%.
An 80/5 mortgage is also a good option to consider for
those who plan to put 15% down. If you compare the
difference in the payment of doing an 80/5 loan as opposed to putting
down 20% the difference in payment is not much and you may
prefer to keep the 5% as reserves for an emergency.
You won't have to pay mortgage insurance!
The way to avoid paying mortgage insurance is by getting
a "piggyback loan" -- a second mortgage to back up the
first mortgage. The first and main mortgage is for 80
percent of the home's price. The piggyback loan is for 5 percent
of the home's price. 80-5-15 means that you get a main
mortgage of 80 percent of a home's purchase price, a piggyback
loan for 5 percent, and made a 15-percent down payment.
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**2nd mortgages are not available in
all states. Please contact us for details.
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