Return of the 80/10/10

Mortgage and Lending with Peoples Bank NMLS 500247

When the mortgage meltdown hit, all lenders slashed the available lending products, but now the pendulum is starting to swing back and lenders are opening up again as mortgages are performing well. One recent addition is the 80/10/10 which I haven't seen in a while.  The point is to avoid mortgage insurance or Jumbo rates.

The Buyer gets an 80% first mortgage and a 10% second, and brings in a 10% down payment. The seconds I am seeing can be 15 or 30 year fixed or ARMs.

A perfect scenario in my market of Wenatchee, Chelan, Leavenworth, Winthrop, is a home selling for $525,000. Our Conventional lending limit is $417,000 - so normally to avoid paying Jumbo rates, a Buyer would need to put down the difference of $108,000. 

But now, they can get a first mortgage at $417,000 and a second of $52,500; reducing their down payment to $55,500.


We all know we won't go back to the crazy programs of 2006-2007; but its nice to see some options out there for the homebuyers.

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