Is it possible to do 3.5-5% down without PMI?

[Jason Meadows]

Hi BPers,

Sometime in the last 6 months or so I remember hearing David say on the podcast that you could do an "FHA-like" situation without actually doing an FHA loan. The result in the scenario he described was that you could put 3.5-5% down without having to pay PMI. I think it had something to do with getting a normal 80% mortgage and then getting a secondary mortgage. Has anyone done this? How does it actually work? Any pitfalls to watch out for?

Thanks in advance,