What is a Combo Loan? #AskBellco

[JACK] Can you tell us like what is a combo loan? [JAMIE] Sure. So Jack and before the cameras started, you know we were talking about when you borrow more than 80 percent of your homes value. You have to have PMI, private mortgage insurance. [JACK] Right. [JAMIE] Well, so this whole idea around combo loans and the reason why they’re unconventional is just that most people haven’t heard of them. So what we’re talking about is where we take two loans, combine them, towards one purchase, in other words a combo. [JACK] Sure. [JAMIE] Uh, and by doing so, you don’t have to have private mortgage insurance or PMI. So it’s just a different way to structure your financing. Uh, we think, uh, at Bellco that it may be a smarter way for those in the right position to take advantage of maybe, you know, we’ve seen sales prices in the fives and $600,000 in, in Metro Denver. And so, uh, one of the ways we see people structure their financing is they’ll take one portion of money on the, on a first mortgage, they’ll take another portion on the second in order to avoid that PMI as well as let’s say they expect a windfall of cash, maybe they want to pay off that second mortgage later and then they will have never had PMI all throughout their financing of their home. So again, it’s, it’s kind of that, um, we really want tofind something that’s going to be tailor made to the member, right, so that, that financing will fit them. Exactly.

Paul Whisler

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