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Zero Down 80/20 mortgage loan is tailor made for those individuals that are lacking in terms of down payment. Zero Down 80/20 mortgage can be termed as two loans for 100 per cent of the buying price.

In this loan, first mortgage happens at 80 per cent of the buying price while second mortgage occurs with a 20 per cent buying price.

You do not need to pay mortgage insurance with Zero Down 80/20 Mortgage. This is quite a relief because you always need to pay mortgage insurance when you have less than 20 per cent down.

Another significant thing about this mortgage loan is that it lowers your interest rates. In Zero Down 80/20 Mortgage, you can either go for a line of credit or fixed second mortgage.

If you prefer fixed second mortgage, you do not need to worry about the increase in interest rates, as it is going to be fixed for the complete duration of the mortgage.

One good thing about fixed second mortgage is that it plays a prominent part in improving your credit score. Talking about line of credit, fluctuations in interest rates will have an impact on your monthly installments.




 

For example, if your credit record is not that good, and interest rates increase all of a sudden, in that scenario your monthly installments is also going to increase. This can create quite a bit of problem for borrowers whose monthly source of income is limited in nature.

So, only choose line of credit when you are confident that interest rates is going to dip in the near future. Before availing Zero Down 80/20 mortgage, it is advisable that you take the assistance of financial expert in terms of choosing the right option for yourself.

Financial expert often suggest you right kind of mortgage loan after taking into consideration your financial condition and credit score. Don’t hide anything from financial expert. In other words, give them all the documents and details they want.

If you don’t follow this route, financial expert will not be able to analyze your financial condition in a proper way.