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Second Mortgages

Some homeowners, either in financial distress or needing a loan to finance some undertaking such as starting a business or sending children to college, may take out a second real estate home mortgage against their home. 

 

This can be a risky undertaking for the lender because, since the home is already under one mortgage in which the home serves as collateral to secure the home mortgage, the second mortgage lender is “second in line” to foreclose on the home if the homeowner who owns the real estate cannot pay.  As a result, the home mortgage lender typically will charge a higher interest rate on the second mortgage on the home than they otherwise would and are rarely willing to loan as much on the value of the real estate as they would on a first home mortgage.  They also tend to have much stricter requirements such as a high degree of equity in the home, a low debt to income ratio and excellent credit.

 

If you are a homeowner who feels you need to take out a second mortgage on your home, talk to a reputable home mortgage lender to determine if you qualify and how much you qualify for.

Disclaimer:         

The material on our website is intended to provide only general information and comments as a courtesy to the general public and potential real estate clients. Although we make our best efforts to ensure that the information found on our website is accurate and timely, we cannot, and do not, guarantee that the information is either. Nor do we guarantee the accuracy of any information contained on websites to which our website provide links.

Do not, under any circumstances, rely on information found on our website as a replacement for sound professional advice from individuals who specialize in such matters. Legal, insurance, and other related subjects are often complicated. For assistance with your specific real estate questions or inquiries please contact one of our knowledgeable real estate agents, any of whom will be pleased to determine whether our agency can assist you.

 

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