1st and 2nd trust deeds (combo loans) – Calculated Industries 3416 User Guide User Manual
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1ST AND 2ND TRUST DEEDS (COMBO LOANS)
Your calculator figures Combo loans, or 1st and 2nd Trust Deeds,
which are common financing options for clients with smaller down
payments, who want to avoid mortgage insurance. The benefit of
Combo loans over single, fixed-rate loans with mortgage insurance
is that the buyer can actually save money obtaining two loans vs. a
single, larger loan requiring monthly mortgage insurance.
This calculator will find, after entry of appropriate loan variables
(including 1st and 2nd TD interest and term), the following loan val-
ues for 80:10:10 —
or any LTV
— loans:
•
Blended interest rate for 1st and 2nd TD and equivalent
interest rate of fixed-rate loan w/mortgage insurance;
•
Combined payment for 1st and 2nd TD and equivalent
payment for fixed-rate loan w/mortgage insurance;
•
Monthly savings of 1st and 2nd TD over fixed-rate loan
w/mortgage insurance;
•
Adjusted term if savings is applied to 2nd TD; and
•
1st and 2nd TD loan amounts and payments.
Your calculator also provides combo loan solutions for combo loans
with an Interest-Only 2nd Trust Deed (
Int-only 2nd
). You may enter
any LTV (default is 80:10:10) in order to calculate the loan values
listed above. This also allows for comparison between a standard
P&I 1st and 2nd TD Combo Loan and an Interest-Only 2nd TD
Combo Loan.
See the following examples. Note the first examples are for 80:10:10
loans, and the last examples demonstrate how to enter any LTV and
comparing Financed Mortgage Insurance to a combo loan.
Note: In some cases a financed MI loan may benefit the borrower and out-perform a
combo loan.