What is a piggyback loan?
The Bankrate.com financial term of the day is: "Piggyback Loan"
A piggyback loan puts one mortgage on top of another so that a homebuyer is spared from paying private mortgage insurance, those dreaded premiums that are triggered when a house is purchased with a down payment of less than 20 percent of the appraised value or sale price. With a piggyback loan, you take out a primary mortgage for 80 percent of the home's value plus a home equity loan or line of credit for the rest.
Homebuyers can climb onboard a piggyback loan to ride away from insurance that can increase your monthly housing bill.
To compare home loans, visit the Mortgage section at Bankrate.com.