Can I use a piggyback mortgage as an alternative to private mortgage insurance (PMI)? Answer:
If your down payment is less than 20 percent of the purchase amount when you buy a house, the lender will likely require that you buy PMI to ensure repayment of the loan. PMI premiums can significantly increase your monthly housing costs, and are no longer tax deductible (as of 1/1/2014). To avoid paying monthly PMI premiums, you may want to consider getting a piggyback mortgage, sometimes called an 80-10-10 mortgage.