2nd Mortgages

Written by Michael Federico
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Taking out second mortgages on homes often gives people a chance to refinance in a way that makes it easier to make monthly payments. Often, people initially have mortgages that they intend to pay off in a relatively short time. This allows them to enjoy lower rates and a lower APR in exchange for having higher payments. Sometimes, the payments are simply too much, and people not only end up getting behind on their mortgages, they actually start to miss payments in other areas, as well.

Taking out a second mortgage can help a person catch up for the time being. However, it can open a person up to a whole new level of debt. There are times when getting a second mortgage really is the best thing for a person to do. It can help pay off school loans, medical bills, or credit card debt. However, before taking a 2nd mortgage, a borrower should really sit down with a credit counselor or other financial professional to weigh all of his options.

Taking Out 2nd Mortgages for 2nd Properties

Whether a person is buying an investment property or a vacation property, he should have options with his second mortgage that he did not have with his first. Mortgage companies will often set up special programs for investors and second home purchasers. A real estate investor might even be able to receive a break on interest rates.

Many people who own two properties find it easier to refinance both of their mortgages into one monthly payment. The single payment is usually more affordable than the two separate payments. It also makes it easier for some to simply keep track of what they owe and to whom each month.

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