80/15/5 Loan 80/15/5 loan is a good choice for elimination PMI (Private Mortgage Inurance). What is PMI? When insuring a loan, the mortgage insurance company shares the lender's risk, but actually assumes only the primary element of risk.  This is to say the insurer does not insure the entire loan amount, but rather the upper portion of the loan.  The amount of coverage can vary, but typically it is 40% to 25% of the loan amount. When you have private mortgage insurance you are essentially protecting the lender from any bad deeds on your part. If you default on your payments then they don't have to worry about it so much because the insurance is in place to protect them. Simply, PMI is an extra payment to you rmonthly mortgage loan payment. But with 80/20 loan you are eliminating PMI. 80/15/5 Loan stands for: 80% first loan: This can be any type of loan, 30 year fixed, Interest Only Loan or any other loan program. 15% second mortgage: A second mortgage or second trust is a loan secured by your property which takes second position to the first mortgage. A second trust carries a fixed interest rate for the life of the loan and amortization periods range from 5 to 20 years with a great new product amortized over 30 years with a balloon due in 15 years. 5%- Cash down payment. If you are interested in 80/20 financing, please fill out a Loan Application. Below I have prepared what documentation I would need from you: Last 2 years W2 forms. Last 2 pay stubs (covering 1 month). Last two years signed 1040s, all schedules if 25% or more of your income is from self employment, overtime, commissions, or employment by a relative. Last 2 years business tax returns if you own 25% or more of a business. Current business income statement. Proof of Social Security, pension, or disability income. Last 2 months bank statements - all pages. Last quarter investment or trust accounts Copies of stocks, bonds, or US savings bonds Current statement for 401(k) or IRA accounts Real Estate you now own: address, current value, loan balance, monthly payment, and rental income if any. Listing agreement and sales contract