The Second Trust (Piggyback) Loan Alaska

The following contains housing information you should know about the second trust (piggyback) loan and if you can avoid it. Read this review if you or a loved one is interested in buying and selling real estate in Alaska.

Local Companies

Heritage Mortgage, LLC
804.201.9434
10124-C W Broad St
Richmond, AK
Golf Savings Bank
206-719-6375
1730 Minor Avenue
Seattle, AK
Paramount Equtiy Mortgage
916-770-8289
3013 Douglas Blvd, Suite 220
Roseville, AK
Homestate Mortgage Company
907-762-5890
3801 Centerpoint Dr
Anchorage, AK
American Mortgage Corporation
(952) 915-5397
6700 France Ave S Ste 230
Edina, AK
First National Bank Alaska
(907) 777-4362
101 W 36th Ave
Anchorage, AK
Gellert H J & Associates
(907) 277-2663
1113 E Fireweed Ln
Anchorage, AK
First National Bank Alaska
(907) 777-4362
Anchorage, AK
Alaska Mortgage Group
(907) 272-6616
1712 Ship Ave
Anchorage, AK
Burke Eddie Loan Officer Sr
(907) 222-6001
322 Muldoon Rd
Anchorage, AK

provided by: 

Even if you cannot afford a 20% down payment on your house, you may still be able to cross the threshold of your dream home. Many lenders will allow smaller down payments - as little as 5% in some cases. With smaller down payment loans, however, borrowers are usually required to carry private mortgage insurance (PMI) which means:

 

  • you may be required to make an initial premium payment; and
  • pay additional monthly fees on top of your regular mortgage payment

 

If these extra charges don’t sound appealing to you, you may consider a second trust loan or "Piggyback Loan."

 

 

What is a Piggyback Loan?

 

A piggyback loan is a combination of two loans that close at the same time to purchase a home. The most common piggyback loan is an 80/10/10.

 

  • 80 percent of the home’s value is financed through a first mortgage.
  • The remaining 20 percent is equally divided between a second, piggyback loan and the down payment.

 

Example

Purchase Price 1st Mortgage Amount Down Payment Piggyback Loan Amount
$200,000 $160,000
(80%)
$20,000
(10%)
$20,000
(10%)

 

 

 

Piggyback Loans vs. PMI

 

As with every financial option, there are pros and cons associated with both piggyback loans and PMI. Choosing the option that’s best for you depends on your individual financial situation and your state’s regulations.

 

 

TIP:  Before deciding to select a piggyback loan instead of PMI, you should consult with a financial professional.

 

 

 

Published on February 15, 2007

Read full article at realestate.com

Featured Local Company

Heritage Mortgage, LLC

804.201.9434
10124-C W Broad St
Richmond, AK

Related Local Event
ARELLO Annual Conference
Dates: 9/21/2010 - 9/24/2010
Location: TBD
Anchorage, AK
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