what is a 2nd mortgage?

Answer 1

A secound mortgage is what you have to take out when the first mortage lender wont lend you all you need to purchase your home,be carefull as the secound mortage is a a far greater interest rate,due to it being a higher risk to the lender,say you cant keep up the payments,and they forclose on you,the first mortage gets his money and fees first,then if there is enough the secound mortage gets his money and fees, if there is not enough maney to cover all selling cost ,intrest and fees, you not only end up with no house but sometimes still in considerable debt,so be carefull not to over exteened on what you can comfortable afford to pay,take out insurance to cover unimployment,as many lose there homes due to this and usally you can insure against it.allways cheeck the fine print on mortage and insurance.

Answer 2

Jamie V obviously didn't have a good mortgage banker/broker and she wasn't filled in on all the details of second mortgages.

There are 2 different types of 2nd mortgages you can have.
1. Fixed 2nd mortgage: this means that the terms are fixed and you pay the mortgage off just like any other mortgage, over the course of 15 to 30 yrs. It can be either a fixed rate or an adjustable rate term.

2. HELOC (Home Equity Line of Credit): this is a line of credit that you can use and payoff and re-use over and over again. This is normally an adjustable rate mortgage that is tied to the prime rate.

The reason you would get a 2nd mortgage is NOT because lenders won't loan up to 100% of you homes value. The reason is that it works out to be cheaper to pay 2 different mortgage payments rather than one mortgage payment based on 100% financing because you'd be stuck paying Private Mortgage Insurance until you payed the loan down to 80% or less of the value.

Answer 3

its a way they let you borrow up to 90% on a new house purchase. 80% is the first mortgage at say 6% and 10% is the second usually for a shorter time and at a higher rate, say 7 1/2%. you pay a lot for two years or maybe three then you refinance when your equity grows to equal 80% of what you owe so you get a new first mortgage for the whole amount. watch it if interest rates are going up though.
Another version is a loan on an existing house that you've had for quite awhile. lets say you have $60,000 equity after 8 years, yiou can borrow a part of that.

Answer 4

A rip off to cause you to be in debt forever, it is a loan against the money you have already paid on your house, it is like starting your housenotes all over again times the usual three in interest.
Suze Orman is a genius. Learn from her. Try a second job instead.

Answer 5

IT'S LIKE A CREDIT LINE OFF OF THE EQUITY YOU HAVE IN YOUR HOUSE , OR YOU CAN HAVE IT BECAUSE THE FIRST LENDER DIDN'T WANT TO LEND 100% LOAN --IT'S AN INSANE TRAP IS WHAT IT IS. I HATE HAVING ONE.