Second mortgages are the popular term used to refer to a second lien on a home. This lien is placed by a lender who agrees to loan money to a homeowner using the home as collateral. The lender then issues a loan for the amount of equity that the borrower has in his or her house. Money from such a line of credit can be used to pay off other debt or prevent the owner from going into bankruptcy.
Typically, a second mortgage in Calgary will carry an interest rate close to the interest rates on first mortgages. While a homeowner may be able to cash out equity by refinancing their current mortgage, the closing costs associated with it make the second mortgage a more attractive option.
A second mortgage Edmonton professional may make it possible for those who need access to their home’s equity to get good advice regarding getting at that equity. An expert may be able to advise a homeowner as to how much equity should be borrowed and what happens if the loan is not repaid according to its terms.
For those with average credit, second mortgages can provide access to affordable loans. It can also be a good way to fund a vacation or college expenses without taking a student loan for themselves or their children.