Mortgage Terms Page 1
203(b): FHA's single family mortgage insurance program which protects lenders against borrowers defaulting; 203(b) financing generally requires a low down payment, however there is also a limit on the total loan amount.
80/20/0, 80/15/5 and 80/10/10 loan plans: Plans whereby the full purchase price of a property is financed by combination loans. For example, in a 80/20/0 loan plan, a first mortgage is secured for 80 percent of the sale price, a second mortgage or a personal loan is then contracted for the remaining twenty percent. The purpose of 100% financing is to avoid mortgage insurance, which most lenders require from borrowers that are unable to pay at least 20% of the purchase price as a down payment. This type of financing is also called piggyback mortgages.