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Kitchen Table Guide · 5 min read
Purchase Money Second
A second mortgage taken at closing, often used to avoid PMI or preserve loan structure.
A purchase money second, sometimes called a piggyback loan, is a second mortgage taken at the same time as the first, at closing. It sits behind the primary mortgage and helps make a specific loan structure work.
Why Buyers Use One
- ✔ To avoid private mortgage insurance on a low-down-payment purchase
- ✔ To keep the first mortgage inside conforming loan limits
- ✔ To bridge the gap between available down payment and desired purchase price
- ✔ To structure a jumbo purchase more efficiently
How It's Structured
A common example is an "80/10/10": an 80% first mortgage, a 10% second mortgage, and a 10% down payment. The exact split depends on the property, the pricing, and the goals of the borrower.
Things to Consider
Second mortgages carry their own rate and terms, often adjustable. The math only wins when the combined structure is meaningfully better than the alternative. We'll compare side by side so the choice is clear.
A conversation, not a sales pitch
Pull Up a Chair.
A piggyback structure isn't right for every purchase. Let's run the numbers next to a traditional first-mortgage-only option and pick the one that costs less over the years you plan to own the home.