How To Obtain A Second Mortgage Loan

How to​ obtain a​ second mortgage loan?
A second mortgage is​ a​ loan that is​ secured by the​ equity in​ your home .​
When you​ obtain a​ second mortgage loan the​ lender will place a​ lien on​ your house .​
This lien will be recorded in​ 2nd position after your primary or​ 1st mortgage lender's lien,​ hence the​ term second mortgage .​
a​ second mortgage is​ also sometimes referred to​ as​ a​ home equity loan .​
There is​ no difference between a​ home equity loan and a​ second mortgage .​
These are just two different terms for the​ same subject .​
a​ second mortgage can either be a​ fixed-rate loan or​ an​ adjustable-rate credit line .​
Interest rates and loan program terms will vary from lender to​ lender so it​ is​ important to​ shop around and compare before committing to​ any one offer .​
A second mortgages are ideal when you​ just want to​ tap into your equity,​ plan to​ move soon,​ or​ are unsure about the​ amount you​ want to​ borrow .​
Another plus of​ a​ second mortgage loan is​ that the​ interest you​ pay back on​ the​ loan may be tax deductible .​
Consult your tax advisor regarding your personal situation but in​ most cases the​ interest is​ 100% fully deductible as​ long as​ the​ combined loan to​ value of​ your 1st and 2nd mortgage do not exceed the​ value of​ your home .​
Loan proceeds from a​ second mortgage loan can be used for just about anything .​
Many consumers take out 2nd mortgage loans to​ consolidate debt,​ do home improvements or​ pay for their kids college education .​
Whatever you​ decide to​ do with your loan proceeds it​ is​ important to​ remember that if​ you​ default on​ your payment you​ can lose your home so you​ will want to​ make sure that you​ are taking the​ loan out for a​ worthwhile purpose .​
A second mortgages aren't for everyone .​
You should weigh the​ cost of​ PMI and payments when choosing your financing options .​
Borrowing more than 80% of​ your home's value will subject you​ to​ private mortgage insurance .​
Your monthly payments should also be a​ factor in​ your decision .​
By taking out equity when refinancing your home,​ you​ will have a​ lower payment than if​ you​ had both a​ mortgage and 2nd mortgage payment .​
Also,​ if​ you​ refinance in​ the​ future,​ you​ will have to​ pay off your 2nd mortgage.

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