November 25, 2017

Best 2nd mortgages in Oakville, Mississauga, Burlington and Toronto

best 2nd mortgage TorontoIf you are looking for money to help pay for debt consolidation, house improvements, or even to buy another house in Toronto then a 2nd mortgage could be what you are looking for to help make it happen. However, when the term 2nd mortgage is brought up you might not know exactly what it means. In simple terms it is another mortgage on your house. Fundamentally what is happening is you are borrowing money for a reason & using your house as collateral.

The word “second” means that the loan you are obtaining doesn’t have first priority on your house if for whatever reason you cannot pay it back in time. In all cases the first mortgage on your house will be paid before any money would go toward your 2nd mortgage’s payment. Understanding this, the next query is why would somebody put their house up as collateral for money.

In the long run 2nd mortgages are great for home improvement financing. If you are of the fainthearted then stick with a fixed rate of interest versus of the variable rate of interest loans. This way you will know exactly what payments are expected each month be it for a 2nd mortgage or another type of loan in order to secure a large ticket item that you have needed for the past few years.

You can expect the rate to be a higher because it is riskier to the lender who knows that if a default occurs the primary mortgage gets paid first & then the 2nd mortgage.  If feasible, pick a fixed rate of interest. Even be aware that 2nd mortgages, like any other loans, have additional closing costs. There’s the appraisal fees, application costs & other closing costs that can be as random as title searches.