Need A Second Mortgage?
A second mortgage is a loan on a property that is in addition to the first mortgage. It offers homeowners a lump sum of cash to pay for important expenses such as debts and tax arrears, home improvement and renovations, education and dream vacation, investments and business financing, etc.
For the lender, this is more risky than the first mortgage, because they are in second position on your property’s title.
To compensate for this additional risk, mortgage rates for second mortgages are always higher than for principal mortgages.
In order to qualify for a second mortgage in second position, lenders will look at four main criteria:
The more equity you have available, the higher your chances of qualifying for a second mortgage will be.
Lenders want to verify that you have a dependable source of income, to ensure that you can make payments.
The higher your credit score, the lower your interest rates.
Lenders need to secure their investment in case you are unable to keep up with mortgage payments.