Two loans vs one insured loan · break-even month · free
80/10/10 Piggyback Calculator — The Break-Even Against PMI
A piggyback is not a way of avoiding a cost — it is a second mortgage that replaces an insurance premium with interest. The premium has a legal end date and the second mortgage does not, so the honest answer is a break-even, not a winner. This runs both structures at the same down payment and tells you which month it flips.
Educational calculators — always consult a licensed professional before making financial decisions.
Both structures buy the same house — this sets the size of every loan below.
The '10' in the middle of 80/10/10. Identical on both paths, so the comparison is fair.
The first '10'. It has to be large enough to push the first mortgage down to 80%.
The classic 80/10/10, paired with 10% cash.
The single most important input on the page — the answer changes with it.
Freddie Mac's 30-year survey average was 6.67% for the week of August 13, 2026.
Applied to both paths.
The default, and what the worked examples use.
Bankrate's home equity loan average was 8.1% APR (published range 5.90%–10.25%) on August 12, 2026.
This changes the answer more than the second-lien rate does.
The default here and in the guide's worked example.
Bankrate publishes 0.46%–1.5% of the loan amount a year, driven mainly by credit score.
Seeded at $0 on purpose — we do not have a citable national figure, so we do not invent one.
The piggyback costs less over 10 yr
$12,827
Cost is interest + PMI + second-lien closing costs. $227,563 on the piggyback against $240,390 on the single insured loan.
When PMI stops — and when the second lien doesn't
On the single loan, PMI of $165 a month can be cancelled on request in month 97 (8 yr 1 mo), when the balance is scheduled to reach 80% of the purchase price, and must terminate automatically by month 111 at 78%. That is $16,005 of insurance in total, and then the payment falls to $2,316 — below the piggyback's $2,396. The second mortgage has no equivalent date: it runs its full term unless you pay it off or refinance it.
The two structures, side by side
| Piggyback | One loan + PMI | |
|---|---|---|
| Cash down | $40,000 | $40,000 |
| First mortgage | $320,000 (80.0% LTV) | $360,000 (90.0% LTV) |
| Second lien | $40,000 | — |
| First-mortgage P&I | $2,059/mo | $2,316/mo |
| Second-lien payment | $337/mo | — |
| PMI | none | $165/mo until month 97 |
| Month-one payment | $2,396/mo | $2,481/mo |
| Cost over 10 yr | $227,563 | $240,390 |
The two paths never cross inside the first mortgage's term at these inputs — the piggyback is cheaper in every month of it. Change the second-lien term first if you want to see how sensitive that is; it moves the answer further than the second-lien rate does.
An estimate from published August 2026 survey ranges, not a quote. Cost means interest plus PMI plus second-lien closing costs — that measure already accounts for the two paths paying principal down at different speeds, but it does not discount future dollars. Both first mortgages are priced at the same rate, which understates any pricing adjustment a 90% LTV loan can carry. Second-lien closing costs are seeded at $0 because no citable national figure exists; enter your lender's number.
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Two worked examples, so you can check the arithmetic
Both are re-run through the same module the calculator above uses, so nothing on this page can drift away from the math. The background to the comparison — what a second lien actually is, how the tax treatment differs, and why refinancing is harder with one — is in the 80-10-10 piggyback vs PMI guide.
1. $400,000, 10% down, 10% second lien over 20 years
First mortgage $320,000 at 6.67% over 30 years; second lien $40,000 at 8.1% over 20 years; against a single $360,000 loan at the same 6.67% carrying PMI of 0.55%.
- Month-one payments: $2,059 + $337 = $2,396, against $2,316 + $165 PMI = $2,481.
- PMI can be cancelled on request in month 97 and must terminate by month 111 — 9 years 3 months — for $16,005 of insurance in total.
- Over ten years: $227,563 on the piggyback against $240,390 on the insured loan — $12,827 in the piggyback's favour.
- Break-even: none. At these inputs the piggyback is cheaper in every month of the 30-year term.
That last line is worth pausing on, because it is not what a monthly-payment table implies. From month 97 the insured loan sheds its premium and pays $2,316 against the piggyback's $2,396 — monthly, it is now the cheaper of the two. It still never catches up on total cost, because a 20-year second lien retires principal fast enough to more than pay for its higher rate. Monthly cheaper and cumulatively cheaper are different questions, and most comparisons only answer the first.
2. Edge case — the same house, a 30-year second lien at 10.25%
Three inputs moved to the unfavourable end of their published ranges: the second lien priced at the top of Bankrate's band and stretched over 30 years, and PMI at the bottom of its band (0.46%).
- The piggyback still starts cheaper, but by only $37 a month rather than $85.
- PMI cancels on the same schedule — the balance does not care what the premium is — so month 97 and month 111 again, for $13,386 of insurance.
- Break-even: month 111. Past that point the single insured loan is the cheaper structure and stays cheaper.
The break-even lands in the same month PMI would have terminated automatically anyway, which is as clear a statement of the trade as the numbers can make. It also shows where the piggyback's advantage in the first example actually came from: not the rate spread, but the 20-year amortization. Change the second-lien term before you change anything else.
What this calculator deliberately does not model
Each of these would need a number nobody publishes. Naming them is more useful than estimating them, because an invented figure moves a break-even by months without ever announcing itself.
The loan-level price adjustment on a 90% LTV first mortgage
Both paths are priced at the same first-mortgage rate so the comparison isolates the structure. In practice a single loan at 90% LTV can carry a small pricing adjustment that an 80% LTV first mortgage does not, which would tilt the result slightly further towards the piggyback. No reliable published figure for that adjustment was found, so it is not estimated here — it is named instead.
A variable HELOC second lien
This calculator amortizes the second lien at a fixed rate. Per the CFPB a HELOC usually carries a variable rate, runs an interest-only draw period, and then steps up when repayment begins. None of that is a fixed schedule, so modelling it as one would be a picture of a loan you do not have. Bankrate's 7.30% HELOC average is shown on the page as context, not fed into the math.
The time value of the payment difference
Cost here is interest plus PMI plus second-lien fees, which nets out the fact that the two paths pay principal down at different speeds. It does not discount cash flows: a dollar paid in month one counts the same as a dollar paid in month two hundred. If you would invest the monthly difference rather than spend it, that is a separate calculation.
Refinancing, resubordination and early payoff
The break-even assumes both structures run untouched. In reality a second lien makes a later refinance harder — Fannie Mae's Selling Guide (B2-1.2-04) generally requires the second-lien holder to sign a resubordination agreement — and paying the second lien off early ends its cost where PMI's end date is fixed by law. Both effects are discussed in the guide and neither is priced here.
What you'll need
- ·Purchase price and the cash you are putting down
- ·The size of the second lien — 10% for an 80/10/10, 15% for an 80/15/5
- ·How long you expect to keep the loans before selling or refinancing
- ·Optional: quoted rates, the second lien's term, and its closing costs
What you'll get
- ✓Both month-one payments — Two loans against one loan plus its premium
- ✓PMI's legal end date — Cancellation at 80% and automatic termination at 78%
- ✓Cost over your horizon — Interest plus PMI plus second-lien fees, both paths
- ✓The break-even month — When the cheaper structure changes — or that it never does
How it works
Set the price, the cash down and the size of the second lien
Both structures buy the same house with the same cash, so both start from an identical total debt. That is what makes the two costs comparable — and it is why the split, not the down payment, is the variable here.
All three loans are amortized in full
The 80% first mortgage and the second lien on one side; the single loan above 80% LTV on the other, with its insurance premium charged monthly until the balance is scheduled to reach 80% of the purchase price.
The break-even month is the answer
PMI must be cancelled by law; a second mortgage runs its term. The calculator finds the month at which that asymmetry overtakes the piggyback's head start — or tells you it never does at your inputs.
The inputs, their published ranges, and where they came from
| Input | Published range (August 2026) | What it does to the answer |
|---|---|---|
| First-mortgage rate | 6.67% (Freddie Mac 30-year survey, week of Aug 13 2026) | Applied to both paths, so it barely moves the comparison — it moves both sides together. |
| Second-lien rate | 8.1% average, 5.90%–10.25% range (Bankrate home equity loan, Aug 12 2026) | Matters less than the second-lien term. A higher rate on a short second still beats a low rate on a long one. |
| Second-lien term | 10–30 years, lender's choice | The largest single lever on this page. A 20-year second retires principal fast enough to outrun PMI; a 30-year second does not. |
| PMI premium | 0.46%–1.5% of the loan a year (Bankrate; driven mainly by credit score) | Sets how much the insured path pays before its statutory end date. Seeded at 0.55%, which is also our PMI calculator's 720–759 figure. |
| PMI cancellation | 80% on request, 78% automatic (Homeowners Protection Act) | Not an input — a legal rule. It is the only reason the insured path can ever win. |
| Second-lien closing costs | No citable national figure | Seeded at $0 rather than estimated. Whatever you enter lands in month one and pulls the break-even towards you. |
Rates: Freddie Mac Primary Mortgage Market Survey — 30-year fixed averaged 6.67% for the week of August 13, 2026 (read 2026-08-19); Bankrate, Current Home Equity Loan Rates — national average 8.10% APR, range 5.90%–10.25%, as of August 12, 2026. Bankrate's survey quotes a 5-YEAR fixed-rate loan; applying it to a longer amortization is a simplification stated on the page (read 2026-08-19); HELOC context 7.3% (read 2026-08-19). PMI premium: Bankrate, Piggyback Loans: What They Are and How They Work — PMI runs 0.46% to 1.5% of the loan amount per year, depending mainly on credit score. Seeded at 0.55% because that value is also the 720–759 figure used by /pmi-calculator/, so the two tools agree at the same inputs (read 2026-08-19). Cancellation thresholds: Consumer Financial Protection Bureau — Homeowners Protection Act (PMI Cancellation Act) examination procedures: automatic termination at 78% of original value, borrower-requested cancellation at 80% (12 U.S.C. §4902(a) and (b)). Loans the CFPB classifies as high-risk instead terminate at 77% or the amortization midpoint, whichever is earlier — this calculator assumes a standard loan (read 2026-08-20). All figures reflect the August 2026 survey period and are editable on the calculator above.
Related Calculators
PMI Calculator
The other half of this comparison on its own — your premium by credit-score band, and the month it can be cancelled.
Mortgage Calculator
The full payment on either first mortgage once taxes and insurance are added to the P&I above.
Closing Costs Calculator
A piggyback means two loan closings. This prices the first one; your lender's fee sheet prices the second.
HELOC Calculator
If the second lien is a line of credit rather than a fixed loan — variable rate, draw period, and the step-up after it.
About this calculator
What is an 80/10/10 piggyback loan?+
Three numbers, in order: an 80% first mortgage, a 10% second mortgage behind it, and 10% of the price in your own cash. The point of the split is the first number — at exactly 80% loan-to-value a first mortgage does not require private mortgage insurance. On a $400,000 home that is $320,000 on the first mortgage, $40,000 on the second lien and $40,000 down. You are not avoiding the cost of a small down payment; you are financing the gap with a second loan instead of insuring it.
Is an 80/10/10 cheaper than paying PMI?+
It depends on the second lien's term far more than on its rate, and on how long you keep the loans. At $400,000 with 10% down, a 6.67% first mortgage, a 8.1% second lien over 20 years and PMI at 0.55%, the piggyback costs $227,563 over ten years against $240,390 for the single insured loan — $12,827 cheaper, and it stays cheaper for the whole 30 years. Stretch the same second lien to 30 years at 10.25% and price PMI at 0.46% instead, and the two cross in month 111: past that point the insured loan is the cheaper one.
When does PMI actually stop?+
By law, not by negotiation. Under the Homeowners Protection Act you may request cancellation once the balance is scheduled to reach 80% of the original value, and the servicer must terminate it automatically at 78%. On the $360,000 loan in the example that is month 97 and month 111 respectively — $16,005 of insurance in total, after which the payment drops to $2,316. A second mortgage has no such date. It ends when its term ends, or when you pay it off or refinance it.
Why is the piggyback's monthly payment lower but its total cost sometimes higher?+
Because those are two different questions and the answers can point opposite ways. In the example the piggyback starts $85 a month cheaper, but from month 97 the insured loan sheds its premium and pays $2,316 against the piggyback's $2,396 — monthly, it is now the cheaper one. Whether it ever catches up on cumulative cost depends on the second lien's amortization: a 20-year second retires principal fast enough to stay ahead, a 30-year second does not. The calculator reports both figures rather than picking one.
Does an 80/15/5 work the same way?+
Yes — the arithmetic is identical, and the calculator handles it. What matters is not the shape of the split but whether the first mortgage lands at or below 80% loan-to-value, because that is the line above which mortgage insurance is required. 5% cash with a 15% second lien reaches it; 5% cash with a 5% second lien does not, and in that case the first mortgage would still carry PMI, so the second lien buys you nothing but another loan. The calculator warns you when your inputs fall into that trap.
What does this calculator not include?+
Four things, named rather than estimated. It prices both first mortgages at the same rate, which understates any loan-level pricing adjustment a 90% LTV loan can carry. It amortizes the second lien at a fixed rate, so it does not describe a variable-rate HELOC with an interest-only draw period. It does not discount future dollars — a payment in month one counts the same as one in month two hundred. And second-lien closing costs are seeded at zero, because no citable national figure was found for them; that seed is generous to the piggyback, and entering your lender's figure moves the break-even earlier.
Want to try different numbers?
Back to the calculator ↑80/10/10 Piggyback Calculator is built and maintained by the RealCostIQ editorial team. Cost ranges and rates are checked against published industry data and contractor quotes, and revised when the underlying figures move. Read our data methodology or more about who builds this. Every calculation runs in your browser — no account, and none of your inputs are stored.
Cost ranges and rates here are checked against contractor quotes and published industry data. If a number still looks off, email Support@RealCostIQ.com and we'll review and fix it.