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Piggyback Loan Calculator

If you’re contemplating a home purchase with less than 20% down (a necessity for many today), my piggyback loan calculator could be useful.

It compares the cost of two mortgages (a first and concurrent piggyback second) versus a single loan that requires private mortgage insurance (PMI).

This allows you to quickly see which option might be best, based on a number of inputs like down payment, interest rates, and PMI costs.

As long as you keep your first mortgage at or below 80% loan-to-value (LTV), no PMI is required, which is the draw of the piggyback loan.

In addition, a loan at/below 80% LTV might come with a lower mortgage rate to boot!

Piggyback Loan (80-10-10) Calculator

Compare a piggyback loan — an 80% first mortgage plus a second mortgage — against a single mortgage with PMI, to see which combined monthly payment is actually lower for your down payment.

Home Price & Down Payment

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Piggyback Loan (80-10-10)

The 1st mortgage is capped at 80% of the home price so it never needs PMI. If your down payment is less than 20%, a 2nd mortgage covers the rest — the classic split is 10% down, but this works for any down payment.

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Typically higher than the 1st mortgage
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Single Loan Alternative (With PMI)

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Used only to estimate your PMI rate
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Select a credit score range to auto-fill
Optional — used to date PMI removal
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You Likely Won’t Need Either PMI or a Piggyback

Full Comparison

Total Monthly Payment Over Time

Amortization Schedule

Disclaimer: This calculator is for informational and educational purposes only and does not constitute financial, legal, or tax advice. The 1st mortgage in the piggyback path is capped at 80% of the home price to avoid PMI; the 2nd mortgage is modeled as a simple fixed-rate, fully amortizing loan, though real second mortgages (home equity loans or HELOCs) may carry variable rates or interest-only periods not reflected here. The PMI rate estimate is averaged across four published lender rate cards (MGIC, Radian, Enact, and Arch Mortgage Insurance) for the credit score, loan-to-value, and loan term entered; actual rates vary by insurer and are confirmed on your Loan Estimate. The single-loan comparison assumes PMI is requested for cancellation as soon as the loan reaches 80% of the home’s original value, which is the borrower’s right under the Homeowners Protection Act with a good payment history; PMI could run longer if cancellation is never requested. Both paths assume the same down payment and do not include closing costs, which can differ between a one-loan and two-loan closing. Consult a licensed mortgage professional for your exact terms.

How to Use the Piggyback Loan Calculator

First, enter your desired purchase price and down payment (either dollar amount or percentage).

While the most common arrangement might be an 80-10-10, which is a first mortgage for 80% of the property value, a second mortgage for 10% of the value, and 10% down, this calculator lets you do any combination you want.

Once you enter in the down payment, it automatically calculates this on your behalf.

For example, if you put in a 5% down payment, it will present the combo loan as an 80-15-5.

[Searching for a home loan? See your options with dozens of lenders fast.]

Next enter the first mortgage rate and loan term (e.g. 30 years) and the same for the second mortgage.

You can then enter information for a single loan and the PMI will be calculated automatically (you can also enter it manually).

From there, you’ll be able to compare each option side by side to determine if one is a better fit than another.

The calculator breaks down the total cost of each loan and what you pay monthly, interest-wise, etc.

This should make the decision between two loans or one that little bit easier…

Drawbacks to a Piggyback Loan

While it’s nice to avoid PMI, it can be a little more work getting two mortgages instead of one, and you might be subject to two sets of closing costs as well.

Another downside to a piggyback loan is the interest rate will likely be a lot higher compared to the first mortgage.

For example, if your first mortgage is a 30-year fixed set at 6.5%, the second loan could be set at 8-9% or even higher depending on various loan attributes.

But even then, the combined cost and monthly payment could be lower than a single mortgage with PMI.

This calculator will allow you to see the monthly payments side by side, the savings of the cheaper option, total PMI paid, and total interest paid on each option.

That could make your decision a little easier if you’re trying to make sense of which to choose.

Also note that you can also always prepay a second mortgage, so if the interest rate is high, you can tackle it ahead of schedule to save even more.

The same can be true of a loan with PMI, but prepayment that gets you to 80% LTV faster still requires a manual review to remove it.

Lastly, if you’re thinking about two loans, know that a mortgage broker can facilitate the origination of both loans at once, which makes life a little easier.

But like a first mortgage, be sure to shop around for the second mortgage to ensure you land a competitive interest rate.

Rates and closing costs can vary widely so don’t just accept the first quote you come across.

Read on: PMI vs. combo loans: which is the better choice and why?

Colin Robertson
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