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NewlyMrs
Laugh-Live-Love LIFE!
Member since 10/06 14432 total posts
Name:
Jennifer
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Question in buying a house & down payments?
This might be a dumb question, but we are new to the house market and I was reading some threads and if I understand correct.....
Do you mean people take out 2 morgages, (1) for cost of house, (1) for down payment?
 TIA for explaining
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Posted 1/24/07 7:51 AM  |
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TheLorax
LOVE
Member since 2/06 5581 total posts
Name:
Suzanne / SuzBride
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Re: Question in buying a house & down payments?
I think that when people are referring to two mortgages, it is when they are putting down less than 20%. If you put down less than 20%, you have to pay PMI Insurance, but you can avoid paying this insurance by getting 1 mortgage for 80% and a second loan for the balance (if you put down 10%, the balance would be 10%)
Benefits of this are that you avoid PMI. The only stinky part is the 2nd mortgage is usually at a higher interest rate (and over a shorter time) so it can add a bit to your mortgage payments.
Edited: PMI not TMI - haha
Message edited 1/24/2007 9:28:30 AM.
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| Posted 1/24/07 8:03 AM |
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PotofLuck06
Our Baby Boy Is Here!!!
Member since 11/06 13241 total posts
Name:
Betsy
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Re: Question in buying a house & down payments?
Posted by TheLorax
I think that when people are referring to two mortgages, it is when they are putting down less than 20%. If you put down less than 20%, you have to pay TMI Insurance, but you can avoid paying this insurance by getting 1 mortgage for 80% and a second loan for the balance (if you put down 10%, the balance would be 10%)
Benefits of this are that you avoid TMI. The only stinky part is the 2nd mortgage is usually at a higher interest rate (and over a shorter time) so it can add a bit to your mortgage payments.
The insurance is PMI, but she explained the jist of it!
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| Posted 1/24/07 8:16 AM |
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NewlyMrs
Laugh-Live-Love LIFE!
Member since 10/06 14432 total posts
Name:
Jennifer
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Re: Question in buying a house & down payments?
ok that makes sense.
what is TMI?
And on average what are payments for the 2 morgage on say a 500,000 house?
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| Posted 1/24/07 8:19 AM |
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MegZee
My bunny
Member since 5/06 8777 total posts
Name:
Meaghan
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Re: Question in buying a house & down payments?
Posted by NewlyMrs
ok that makes sense.
what is TMI?
And on average what are payments for the 2 morgage on say a 500,000 house?
its PMI - mortage insurance - if you dont put 20% down (or do the piggyback), banks want PMI because the less you put down, the bigger risk of default you have - once your have 20% equity in your house, you can get it cancelled.
Ok, say you put $50K down, your mortgage is $450K - a $450K mortgage at 6.25% fixed for 30 years is a payment of $2770.73 - and dont forget taxes and insurance!
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| Posted 1/24/07 9:12 AM |
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mrsmck
Be a big girl!
Member since 5/05 4898 total posts
Name:
Donna
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Re: Question in buying a house & down payments?
We have 2 mortgages.
One for 80%
One for 15%
We put down 5% for downpayment.
Good Luck!!!
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| Posted 1/24/07 9:21 AM |
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lorich
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Member since 6/05 9987 total posts
Name:
Grammie says "Lora Gina"
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Re: Question in buying a house & down payments?
Look around...there are many different programs out there that do not require PMI OR piggybacking loans. Don't pay more than you have to.
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| Posted 1/24/07 9:26 AM |
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TheLorax
LOVE
Member since 2/06 5581 total posts
Name:
Suzanne / SuzBride
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Re: Question in buying a house & down payments?
Posted by PotofLuck06
The insurance is PMI, but she explained the jist of it!
haha - thanks. Duh.
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| Posted 1/24/07 9:28 AM |
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cjik
Welcome 2010!
Member since 2/06 8879 total posts
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Re: Question in buying a house & down payments?
Many people take out a second loan if they haven't sold their existing home at the time of purchase. Then when they sell their existing home, they pay off one loan.
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| Posted 1/24/07 9:44 AM |
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NewlyMrs
Laugh-Live-Love LIFE!
Member since 10/06 14432 total posts
Name:
Jennifer
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Re: Question in buying a house & down payments?
Posted by lorich
Look around...there are many different programs out there that do not require PMI OR piggybacking loans. Don't pay more than you have to.
we can I begin to look for such loans?
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| Posted 1/24/07 12:43 PM |
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lorich
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Member since 6/05 9987 total posts
Name:
Grammie says "Lora Gina"
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Re: Question in buying a house & down payments?
Posted by NewlyMrs
Posted by lorich
Look around...there are many different programs out there that do not require PMI OR piggybacking loans. Don't pay more than you have to.
we can I begin to look for such loans?
We're no doubt going with Bank of America. It's one of the many programs out there. We were counseled by LI Housing Partnership. We made too much to qualify for a few programs, but not this one. I believe you had to make under $140k or $150k as a couple.
We had called BofA direct and were not offered this. It wasn't until we met with LIHP and they told us about this program for First Time Homebuyers.
HTH.
Oh, if you make an appt with LIHP make an appt with Lynn Law. Tell her I sent you. FM me for my name, etc.
Good luck!
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| Posted 1/24/07 1:14 PM |
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MegZee
My bunny
Member since 5/06 8777 total posts
Name:
Meaghan
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Re: Question in buying a house & down payments?
Posted by lorich
Posted by NewlyMrs
Posted by lorich
Look around...there are many different programs out there that do not require PMI OR piggybacking loans. Don't pay more than you have to.
we can I begin to look for such loans?
We're no doubt going with Bank of America. It's one of the many programs out there. We were counseled by LI Housing Partnership. We made too much to qualify for a few programs, but not this one. I believe you had to make under $140k or $150k as a couple.
We had called BofA direct and were not offered this. It wasn't until we met with LIHP and they told us about this program for First Time Homebuyers.
HTH.
Oh, if you make an appt with LIHP make an appt with Lynn Law. Tell her I sent you. FM me for my name, etc.
Good luck!
we did the same thing - I had to call about 10 people at BOA before I found someone who knew the program that I had heard about - then we went to the LIHP. But its worth having no PMI and the same awesome rate on our one mortgage
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| Posted 1/24/07 2:12 PM |
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veeandrich
LIF Infant
Member since 5/06 325 total posts
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Re: Question in buying a house & down payments?
Message edited 1/26/2007 10:08:37 PM.
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| Posted 1/26/07 10:00 PM |
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JMF
LIF Infant
Member since 3/06 230 total posts
Name:
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Re: Question in buying a house & down payments?
You can take out 2 mortgages... its called an 80/ 20. One morgage is for 80% of the loan the other is for 20% of loan. It avoids PMI (insurance that basically goes out the window).
Message edited 1/27/2007 5:31:48 PM.
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| Posted 1/27/07 5:31 PM |
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