Piggyback loans

A way of describing a second mortgage that is “piggybacked” on a first mortgage to enable the borrower to buy a home without private mortgage insurance. The first or primary mortgage generally covers 80% of the loan; the piggybacked, or second, mortgage covers a percentage of the remainder not covered by the down payment. The interest rate on the second mortgage generally is higher than the first mortgage, but it can cost less than a mortgage that requires the buyer to pay a private mortgage insurance premium.

Most Recent

Are Home Equity Loans a Cheap Way to Borrow Money?

Home equity lines of credit can be a cheap way to borrow money for home renovations, college bills or credit card debt. But is your home worth enough to support a second mortgage?

What Is PMI (Private Mortgage Insurance)?

If you don't make a 20% down payment, you'll be required to carry private mortgage insurance, or PMI. Although you're the one who must pay monthly premiums for this coverage, it protects the lender, not you.