If you are holding off purchasing your home because you do not have a large enough down payment, a piggyback mortgage could help you qualify for financing. Piggyback mortgages are a way around the twenty percent down payment; here is what you need to know about securing a piggyback loan. Piggyback loans are a way of helping you secure the necessary down payment to qualify for a mortgage; by securing this piggyback loan you may be able to avoid purchasing Private Mortgage Insurance (PMI). Piggyback mortgages vary from one mortgage lender to the next; some require that you have at least 10% of your down payment while others will loan the entire 20%. A piggyback mortgage is essentially a second mortgage secured by your home. This loan differs from a home equity loans in that you must qualify for the piggyback loan in order to qualify for your primary mortgage loan. The good news for homeowners using these loans to qualify for financing is that the interest you pay on both loans is tax deductible. It is important to remember this piggyback loan is secured by your home just like the primary mortgage. If you fall behind on the payments for either mortgage the lender could foreclose and take your home. To learn more about your options when applying for a mortgage loan and how to avoid common homeowner mistakes, register for a free mortgage guidebook using the links below. |
