If you need to finance more than 80% of your home's price, a "piggyback loan" is a way to avoid PMI (private mortgage insurance). A "piggyback loan" is a second mortgage to back up the first mortgage. The first and main mortgage is for 80 percent of the home's price. The piggyback loan is for the remainder amount of financing you need.
An alternative to private mortgage insurance, also known as a second trust loan. The most common type is an 80/10/10 where a first mortgage is taken out for 80% of the home's value, a down payment of 10% is made and another 10% is financed in a second trust at a higher interest rate. In some cases, you may even qualify for a piggyback loan with as little as a 5% down payment.
A loan in which the buyer takes a first mortgage to finance part of the value of the property and a second mortgage to finance another part of the value. For example, a buyer could put 10% down, then take out a first mortgage for 80% of the home's value and second mortgage for the remaining 10% of its value. The two mortgages together are called a piggyback loan.