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Mortgage & Refinancing Information |
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The Zero Down 80/20 Mortgage
This is an excellent loan for those that are lacking the down payment required for other types of mortgages. The 80 20 mortgage is simply two loans for 100% of the purchase price. It is a first mortgage at 80% of the purchase price with a 20% second mortgage. If you are a conforming borrower, doing your loan in this manner will save you from having to pay mortgage insurance. Mortgage insurance is almost always required when you have less than 20% down. But with the 80 20 loan you avoid this necessary evil. If you are a sub-prime borrower, doing you loan in this manner will typically keep your interest rates ½% to 2.5% lower than doing a 100% one loan. A 100% one loan is simply one loan for the entire purchase price. Many times you will have two choices when it comes to the second mortgage portion of the 80 20 mortgage. The second mortgage can either be a fixed second mortgage or it can be a line of credit. If it is a fixed second mortgage. The interest rate is fixed for the entire length of the mortgage. Most fixed second mortgages are a 30 due in 15. Meaning that the second mortgage is amortized over 30 years, but is due in 15 years. Basically it is a balloon payment. Don't let this scare you. Statistically people refinance or sell their home every 7 to 9 years any ways. If it is a line of credit as the second mortgage. The interest rate will fluctuate as the Federal Reserve adjusts the prime interest rate up or down. The benefit of going with the line of credit as the second mortgage is that the interest rate is normally much lower than the fixed second mortgages rate. It can be 2% to 5% lower. If you are considering doing the 80 20 loan have your loan officer compare the two different options if you have both available to you. You may also want to consider an 80 20 interest only loan. The interest only loan could save you hundreds of dollars in mortgage payments every month. This can help you purchase a more expensive home or keep the payments down on the home you want to buy. About The Author Matthew Allen is a mortgage consutlant with Action Brokerage Services, Inc. in Medford Oregon. He is also the author of "How To Buy A Home With Zero Down, Even If You Have Damaged Or No Credit" You can visit his website at http://www.realmortgageadvice.com.
MORE RESOURCES:
What are the hidden costs of refinancing a mortgage? Fox Business 3 Mortgage Refinance Strategies to Consider in 2021 The Motley Fool Mortgage refinance rates continue hitting record lows – here’s how to get the best deal now Fox Business What is a mortgage prepayment penalty fee, and how does it work? Business Insider What Is A Debt Consolidation Refinance? | Pros And Cons The Mortgage Reports Black Knight Delivers Next Generation of its Loansifter Product, Pricing and Eligibility Engine for Mortgage Brokers Yahoo Finance Racked Up Holiday Debt? Refinancing Could Help You Pay It Off The Motley Fool 3 Options for Financing Home Improvements in 2021 The Motley Fool Can You Refinance A USDA Loan? | USDA Refi Options The Mortgage Reports PropertyGuru Tackles Top Home Loan Refinancing Misconceptions Among Singaporeans in New Research Taiwan News Mortgage refinance: Everything you need to know Fox Business Buying a Second Home: What to Do and How Much It Costs Credible News How to decide if you should refinance your mortgage Fox Business How to refinance your mortgage Fox Business Who's exempt from the new mortgage refinance fee? Fox Business Everything You Should Know About The New Mortgage Refinancing Fee That Goes Into Effect Dec. 1 Forbes Today’s mortgage refinance rates hold steady for third consecutive day | December 11, 2020 Fox Business Today’s mortgage refinance rates mixed — one key rate drops while two hold steady | December 15, 2020 Fox Business How do I get the most out of my mortgage refinance? Fox Business 4 ways to get lower mortgage refinance rates Fox Business Today's mortgage refinance rates don't budge for fourth consecutive day | November 24, 2020 Fox Business 10 things to know before refinancing your mortgage Fox Business The best mortgage refinance lenders of January 2021 Business Insider Refinancing your mortgage? Don’t make this mistake Fox Business Today's mortgage refinance rates stay low with the election underway | November 3, 2020 Fox Business Today’s mortgage refinance rates climb upward — though one key rate holds steady | October 23, 2020 Fox Business Complete Checklist of Mortgage Refinancing Requirements Credible News 10 tips for getting the best mortgage refinance rates Business Insider How often can you refinance your mortgage? Fox Business How to refinance your mortgage without closing costs Fox Business Thinking of refinancing your mortgage? Do your homework before you jump in. The Philadelphia Inquirer When should you refinance your mortgage? Fox Business Today's mortgage refinance rates hold steady at unprecedented lows | October 16, 2020 - Fox Business Is now a good time to refinance your mortgage? Fox Business How to get a low-cost mortgage refinance Bankrate.com How to Refinance Your Home | Home Lending Chase News & Stories Today’s mortgage refinance rates keep sinking, reaching 37-day low | November 13, 2020 Fox Business How much can you save by refinancing your mortgage? Fox Business Mortgage refinancing is about to get more expensive Pittsburgh Post-Gazette No-Closing-Cost Refinance: Is It Right for You? NextAdvisor The impact of the coronavirus on mortgage refinancings Brookings Institution |
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