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Of course. I was even able to get a 90/10 mortgage. Go with smaller banks
The answer to your question is yes, you can put very little money down on large loans but you pay for the additional risk in higher interest rates and/or PMI.
Getting a second mortgage to avoid the PMI is still an option but you should look at the cost. Second mortgages are usually much more expensive and you have that high cost until you pay them off or go through a costly refi. If you pay the PMI, once you hit 20% equity through either paying down the mortgage or appreciation, the PMI can drop off. Usually you can get out from under PMI faster than you can pay of the second mortgage. With the second mortgage, you pay down the total loan balance a little quicker but you are paying the higher interest rate for way longer.
Yes, you can always pay less but you’ll most likely deal with PMI
Rising Star
I realize my question may not be clear. An 80/20 mortgage is a product where you take out two loans for the house. One is 80% LTV and the second one is the residual. On the residual or piggyback loan I’d put 20% down to avoid PMI on both products. They were big pre housing crisis. I want to spend approximately $40k on a $1M house without PMI.
Rising Star
A lot of these rules don’t apply to loans beyond the GSE loan limits of $510k or 765k.
In my experience lenders want 20% down for loans they can’t sell to the GSEs / keep on their books
Also depends a lot on who owns the homes you are targeting. This recession is hitting working class folks a lot harder. I wouldn’t necessarily expect broad housing decline. Especially in non-urban areas
Rising Star
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You could probably go as low as 3%, but monthly costs skyrocket.
Most jumbos - geo dependent - require 20 down. Adding a home equity for 10% works and avoids PMI, but interest not deductible. Find a broker in your area to work with.
I put down 5%
Rising Star
Also new home builders partner lenders will gladly work out a 90/10 with PMI integrated into the mortgage payment.