Second Lien (Piggyback)

A Second Lien mortgage has gone by many names over the years like a “piggyback mortgage” or an 80-10-10. This type of financing solution allows homebuyers the flexibility to take advantage of certain loan programs that need larger down payments, they can also help avoid jumbo mortgage thresholds and even alleviate the need to pay Private Mortgage Insurance (PMI).

 

Is it right for you?

A creative choice for qualified first-time or seasoned homebuyers who have less capital for a 20% down payment, but are seeking to capture the benefits available on certain loan programs that require an 80% loan-to-value ratio. Also a great option for homeowners needing to buy a new home before their current house is sold.

 

Is it right for your situation?

Primary residence, single family and 2-4 unit properties, condos and townhomes, and Planned Unit Developments (PUDs); maximum loan amount up to $300,000.

 

Features and Benefits

  1. Down payments as low as 5%
  2. Private Mortgage Insurance (PMI) may not be required
  3. Fixed-rate for up to 20 years (balloon option available)
  4. First-time homebuyers are eligible
  5. Interest paid may be tax deductible (consult a qualified tax professional)

 

In certain instances, second liens can be used with a Conventional Loan to help reduce your cash out of pocket for a down payment or eliminate mortgage insurance premiums all together. It is also a great way to purchase a home that has a sales price over your area’s jumbo mortgage loan limit, lowering the amount of your down payment or the higher interest rates a jumbo loan typically carries. Be sure to check out the Jumbo Buster program if you need a mortgage over $453,100.

Ready to get expert advice and determine if this works for your personal situation? Contact one of our local, caring mortgage professionals at a Branch Near You.