If you decide to borrow more against the same property, it is a second mortgage.

The second mortgage will stand behind the first mortgage. That is, if you sell the property, you will repay the first mortgage first and any remaining proceed will then be used to pay the second mortgage.

Second mortgage is considered a higher risk than a first mortgage since the lender who holds the first mortgage has the first right against the property. For this reason interest rate on second mortgage is usually higher than interest rate on first mortgage.

Second mortgage is often used to consolidate multiple debts into a single debt with one monthly payment. Or second mortgage may be used to pay for that vacation or renovation that you have always wanted.

Many businessmen will use a second mortgage to finance their start up capital or to pay for the company equipments, machinery or vehicles.

Even people with poor credit or bad credit can obtain a second mortgage provided that there is sufficient equity in the property. However interest rate may be higher due to the poor credit score.

Again there are numerous lenders ready to provide you with a second mortgage. Please shop around for the best rate and best deal.

top