When you hear the following term, Second Mortgage, you may wonder why anyone would want a second mortgage. There are many reasons to get a second mortgage, and places like Triple M Mortgages are here to answer questions and are here to facilitate the process. Not sure if Second Mortgages are for you? Let’s take a look at second mortgages and what they can do for you.
What is a Second Mortgage?
A Second Mortgage is a type of loan that borrows against your equity. It is given in addition to your primary mortgage. The application for obtaining a second mortgage is similar to a first mortgage. It can also be called a piggyback mortgage and uses your home or property as collateral. You are borrowing against the value of your home.
How Does it Work?
When you get a Second Mortgage, you will get the funds in one, lump-sum payment and you can use it however you need to.
Second mortgages often close anywhere from a couple of weeks to a month.
What Does it Do?
People often use this type of loan to pay off larger financial obligations. Second mortgages are beneficial when used to consolidate debts like credit cards. If you have multiple debts and accounts, you can consolidate all of those debts into one, lower payment. Using a second mortgage for debts helps create lower payments and develop home equity. Second mortgages have lower interest rates, interest payments that are tax-deductible, and have longer repayment periods. Besides debt, you can use a Second Mortgage for home improvements, renovations, medical expenses, and education tuition.
Why Get a Second Mortgage?
There are other reasons a Second Mortgage would be good for homes and businesses.
- A second mortgage is useful to start up new businesses. You can use your property to get funds to handle start-up costs.
- You can use a second mortgage to invest in another property or renovations
- Consolidation of other high-interest credit card debt for lower rates and monthly payments.
- The best option for quick liquidity
What Do You Need To Qualify for a Second Mortgage?
- Home Equity: You will need a large amount of home equity to qualify for a second mortgage.
- Good Credit: You will need a high credit score, the lower your score is, the higher your interest rates will be.
- Steady Income: having proof of a steady income will help you qualify for a second mortgage, as it shows you can make payments
If you still have questions about Second Mortgages and wonder if it could be an option for you, contact Triple M Mortgages today. We can answer questions and guide you along the application process. Contact a Mortgage lender, choose a mortgage. Consider applying for a second mortgage today!