Do you want a second mortgage, but want to pay a minimal down payment?
80/15/5 loans, loans that are only available in Texas, are sometimes called combination financing or piggyback loans and offer an affordable way to provide financing for a purchase, refinancing, home improvement, or debt consolidation transaction.
This is a loan which carries a second mortgage for up to 15% of the purchase price of the property. It is usually used when wishing to avoid PMI insurance or to keep your first mortgage under the FNMA/FHLMC limit to avoid Jumbo rates. The borrower puts 5% as a down payment and then finances a first mortgage up to the FNMA/FHLMC limit and a second mortgage of up to 15% of the purchase price. Other variations are 80/10/10 or 75/15/5. The borrower has a wide range of mortgage options on this type of loan, which include fixed rate or ARMS.
The 80/15/5 loan is advantageous to the borrower because the mortgage payment is tax deductible and you have the option to pay off your second mortgage early to reduce your total payment. Contact HomeWay Mortgage today and we will work out a 80/15/5 Loan plan that will work with your financial situation!