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I bought my first house ~7 years ago with a 80/15/5 loan (80% first mortgage, 15% second mortgage, 5% down).
Do these loans still exist in todays climate? I am looking to purchase a new home and would be interested in a 80/10/10 loan or something similar (80/5/15 etc).
Thanks in advance for any help.
Cheers
still very available.
requirements are just tighter...... like reserves and scores.
Thanks Dallas. My wife and my scores should not pose any problem, nor should reserves.
Can I get your take on these types of loans? I like the idea of them because I have heard that it can be difficult to have PMI removed from a mortgage. I also like that I can pay down/off the second loan at an accelerated pace basically lowering my monthly payments in the future.
Thanks again for your help!
Hi watchmann, you make a good point--and when we get to the point of putting an offer on a house we will seriously look wether we can reach 20% down without too much pain. Keep in mind that reserves considers things like retirement savings etc that we have no interest in touching until we retire. Also, we have a number of investments that we would rather not liquidate at this moment--although we certainly could in order to get to 20% down. I think it all comes down to comfort. I would rather pay a bit of extra $$ for a second mortgage than to liquidate most of our savings.
Having 6 months of reserves is not hard terribly difficult. Converting those reserves to $$ is not always easy or desirable.
Cheers
80/10 is a great option. Compare it to 90% + PMI and pick one.