Compass Mortgage -Piggyback Loans

Piggyback Mortgages in New Hampshire

Piggyback mortgages are used to avoid “Private Mortgage Insurance” (PMI) requirements. Normally when you put less than 20% down, the lender will require you, the borrower, to pay PMI.

As a consumer, you don’t want to pay PMI. But you have to if you want a really good interest rate – unless, you piggyback.

Normally when you piggyback, you borrow 80% of the purchase price on a 1^st mortgage and the rest of the money on a 2^nd mortgage, up to 100% loan-to-value financing.

Example : 80/10/10 piggyback at $250,000 purchase price:

(80% 1^st mortgage | 10% 2^nd mortgage | 10% borrower's own funds)

	PMI Loan	Piggyback
1^st Mortgage amount	$225,000 @ $1349/mo	$200,000 @ $1199/mo
2^nd Mortgage amount	N/A	$25,000 @$150/mo
PMI	$97.50/ mo	N/A
Total payment	$1446.50/mo	$1349/mo

As far as the 1^st mortgage lender is concerned, you are putting 20% down (because you are only borrowing 80% from them). You may have borrowed part of the 20% down in the form of a 2nd mortgage, but you still don't have to pay the PMI.

To learn more about obtaining the mortgage that’s right for you, call Charley Farley at (603) 471-9300 or e-mail charley.farley@weloannh.com.

Compass Mortgage Inc. - 172 Route 101 - Bedford, NH 03110-5416
Office Phone: (603) 471-9300 Fax: (603) 472-8811 Toll Free Phone: (877) 211-5300

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