Second Mortgage: Better Source Of Needed Cash

By: Mike Hamel

A second mortgage is a mortgage taken out in “second position" on a property that already has a mortgage. A second mortgage will give you a fixed amount of money repayable over a fixed number of years.

Get better interest rates with a second mortgage

Second mortgages come with better interest rates than other types of loans. You can select either a fixed rate or an adjustable rate of interest. If you select a fixed-rate second mortgage and you stay in your home for several years, you’ll save money over an adjustable-rate loan if interest rates go up, which they usually do.

Lower monthly payments with a second mortgage

According to financial experts, debt consolidation is the second most popular reason homeowners take out second mortgages.

Debt consolidation could leave you with a single monthly payment instead of a number of bills. This can decrease your monthly expenses and increase your cash flow.

Increase your home’s value with a second mortgage

Accessing the equity in your home is one way to pay for home improvements. But not all improvements are created equal. The best return-on-investment for your home improvement dollars are:

- Remodeled rooms - kitchens and bathrooms add the most value.

- Second-story addition - as long as it matches your home’s existing style.

- Family room addition or basement finish - increasing usable square footage is a good idea.

- Energy efficiency - new heating or cooling system, new windows or added insulation.

A?remodeling rule of thumb suggested by The National Home Builders’ Association is to keep the total value of your home to no more than 15% above the median sales prices for homes in your area.

Get more information, plus a no-risk loan quote at . It will cost you nothing to see if a second mortgage could be a good financial move for you.

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