mortgage without PMI and less than 20% down

[moneybags]

Any options for this? I've heard there are, but can't pinpoint them.

[james.hendrickson]

Yeah, so one thing a lender might be able to do is give you a first mortgage and then a second mortgage.

So how this works is...lets say you only have 15% down payment. In a normal situation you'd pay the 15% down, and get a single mortgage for 85 of the value of the place. Then you'd pay PMI until you payed down the mortgage to less than 80% loan to value.

What a clever lender might be able to do is split the transaction where you get a first mortgage for 80% of the value of the place, and then a second mortgage for the additional 5%. This *might* let you avoid PMI.

This was a thing back when I was buying places in DC about 10 years ago, I don't know if lenders are still doing it.

[kork13]

2 readily available options that I'm aware of.

(1) VA mortgages do not require PMI under any circumstances. However, unless you have a VA disability rating (above I think 10%... which honestly is a pretty low bar, once you leave the military), you'll have to pay the VA funding fee, which serves a similar purpose as PMI but is paid one-time, upfront.

(2) Seller financing. Not a sure thing, but private seller financing may not required to carry PMI, though the seller does have the choice to require it.

[Jluke]

Doctor loan or whatever they are called. For doctors of course.

[bjl584]

Probably the "easiest" way is to find a lender who will write a first and a second mortgage on the property.
Very common pre 2008, but probably hard to find today

[crazyliblady]

If you qualify for a VA or FHA mortgage, you can get one without a PMI.