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Mortgage Load 80-10-10?

Hi,

I have a question and not sure if mortgage lender still offer this type of service anymore. I am looking to purchase a new home in the coming months. My credit rating is above 740+ in the excellent zone. I currently have a house I am living at with above 25% - 35% equity. I also have a condo as a rental property. That property however value is lower than my mortgage loan on it, but I do have a renter in there.

I am looking to purchase a new property and might not have full 20% down payment. So I was looking of doing an 80-10-10 or maybe 75-15down-10 second loan. After purchasing this new house, I will then sell the current house and immediately pay off the 10% second loan.

I haven't been in the market for a house loan for awhile and not exactly sure with recent market changes if that is still offered.

Anyone if Mortgage lender still offer this and given on my situation above, would I suspect great difficulty?
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June 07 2011 - Corona
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Answers (6)

You might consider placing a Line of Credit on your current properties equity. An  L.O.C. or HELOC are quick, with low rates and low cost. And you could establish the LOC and not have to pay interest on it until you used it.  

Use the LOC funds as your down payment (or part of your down payment), and you should avoid having to pay the MI.  You disclose that your funds are coming from a LOC for the Debt to Income ratio.

Once you sell your home with the LOC the line will be closed.

Hope this is helpful.
Thanks,
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June 10 2011
With your fico we can do 3 different styles of MI all the way up to 97% ltv.  Lender paid, Hybrid and single premium. There are lots of options.  Don't get hung up on trying to do things too much the old way with combo loans and this and that.  It's a different market.  MI is pretty cheap in your score range, and for now, tax deductible.  MI was pretty much gone over the last 18 months.  It's back and cheap.  Don't sweat it too much.
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June 10 2011
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Ideally renting that make sense. But given the situation without selling it, I would not be able to do 20% down and might result in having to pay for PMI.

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June 10 2011
You can rearrange your situation for a better outcome. Why do you want to sell a house with equity? If you've owned the condo for more than 2 years you can use 75% of the rent toward your qualifying. If you are going o occupy the new home you can use the future rent on your current home as income baring you find a new tenant before you close on your new home. This will give you 2 rentals, allow you to keep your reserves, and only put 3.5% down. Let your money work for you.
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June 08 2011
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Thanks. I'll keep that in mind. At the moment, the lot is empty and the builder is not going to release it for another 4 months. I am exploring options in the mean time.
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June 07 2011

Smilepak: I noticed you are in Corona and we are a direct lender located in Irvine. As for the 80/10/10 that program is still available but most banks are only going to a 70% CLTV: Combined Loan-To-Value.. the 1st & 2nds added together.  I have not seen anyone, including us, go to 90%. We are still feeling the pains of 4 years ago but I do have an idea for you.

BUYOUT THE MORTGAGE INSURANCE.

I structured a loan for a client who did not want the monthly mortgage insurance, actually, it was pushing our DTI's (Debt-To-income) ratios above the limit so we "bought" the mortgage insurance out as a one time Single Pay Premium. Call me or send me an email and I can give you seveal options on how to do this with your realtor and the seller.

I hope this helps, Marc

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June 07 2011
 
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