Second Mortgage loan information

A second mortgage loan. lending money for a house or home...

What is a second mortgage? (Second mortgage loan)

In real estate a property can have more than one loan against the property (house, home). A second mortgage loan is a secured mortgage loan that is subordinate to another mortgage loan active on the same property.

The second mortgage loan is called subordinate because if the loan on the house goes in default, then the first mortgage lender (mostly a bank) gets his money first. And if there is money left the second lender gets his money (could be the same bank). But since there is more risk involved, interest rates tend to be higher for the second mortgage.

P.S.: If you take a second mortgage then you are running the risk of putting yourself in deeper dept. A second mortgage could be used to renovate your house to make it more valuable. It should not be used to buy a (second) car. People should only buy what they can afford.

P.P.S.:

refinancing - remortgage

If you want to save money it could be interesting to remortgage or refinance your loans in one combined loan.

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