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The Second Trust (Piggyback) Loan California

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 California.

Local Companies

Mission Hills Mortgage Bankers
(559) 228-6678
1312 E. Shaw Ave #101
Fresno, CA

Empire Home Loan
916-783-8080
151 N Sunrise Ave
Sacramento, CA

Countrywide Home Loans
(661) 397-2535
5101 Ming Ave
Bakersfield, CA

First Alliance Mortgage
(619) 426-2725
660 Bay Blvd
Chula Vista, CA

Nohemia Mortgage Relief and Co
(619) 781-8178
629 3rd Ave
Chula Vista, CA

Community Financial
800-785-4952
1099 E. Champlain Ave. Suite A#276
Fresno, CA

The Mortgage Mentors
(916) 526-2896
2377 Gold Meadow Way
Gold River, CA

California Mortgage Loan
800-785-4952
155 E. Shaw Ave. Suite 303
Fresno, CA

Ricoh Business Systems
707-628-5213
1001 Galaxy Way, Ste. 102
Concord, CA

U.S. Mortgage Center
559-222-3100
1241 East Shaw Avenue
Fresno, CA

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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

Mission Hills Mortgage Bankers

(559) 228-6678
1312 E. Shaw Ave #101
Fresno, CA

Read more about The Second Trust (Piggyback) Loan

- What to think about when you're buying a home California

Answer these questions and be sure you're making sound financial decisions.

- What You Need to Know About Private Mortgage Insurance California
- Pulling Together a Down Payment California
- Do I have to have private mortgage insurance California
- Buying Commercial Real Estate California
- Top Six Down Payment Mistakes California
- Why Zero Down Payment Loans Can Be Risky California
- Interest Only Mortgage California
- Finding the Right Home Loan California
- Low down payment? A piggyback loan or PMI can help California

Regional Articles

- Low down payment? A piggyback loan or PMI can help California

Sans a 20-percent down payment, you'll need to pay for either a second loan or lender's mortgage insurance.

- Do I have to have private mortgage insurance California
- Pulling Together a Down Payment California
- What to think about when you're buying a home California
- Top Six Down Payment Mistakes California
- Buying Commercial Real Estate California
- Why Zero Down Payment Loans Can Be Risky California
- Finding the Right Home Loan California
- Interest Only Mortgage California
- What You Need to Know About Private Mortgage Insurance California

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Advertising	Family	Home Services	Real Estate Resources
Business Services	Fashion	Industrial Goods & Services	Retail & Consumer Services
Career	Financial Services	Insurance	Software
Cars	Food & Beverage	Internet	Technology
Computer Hardware	Franchise	Legal	Telecommunications
Construction	Health	Miscellaneous	Trade Shows
Education	Holidays	Nightlife	Travel
Entertainment	Home Appliances	Online Database	Weddings
Environmental	Home Electronics	Pets	World History