If an individual needs to gain access to additional financial funds, he/she may consider obtaining a second mortgage. Second mortgages are mortgages that are obtain in addition to an existing primary mortgage. When an individual acquires a second mortgage, he/she will have two mortgages that he/she must repay. The repayment of a second mortgage works in the same manner as the repayment of a primary mortgage.
An individual will be provided with a specified sum of money. Each month, he/she will make fixed payments, in order to repay the amount of the loan and the interest rate attached to the loan. Generally, the repayment schedule will endure for thirty years, though this can very base upon a number of factors, including the cost of the home.
There are a number of different reasons that an individual may choose to obtain a second mortgage. It may be more appropriate for an individual to acquire a second mortgage than to refinance his/her primary mortgage. He/she may wish to obtain better interest rates.
A second home mortgage is often a suitable option for individuals who need the finances to complete a large, one time purchase. For example, an individual may use a second mortgage to purchase a motor vehicle, pay medical bills, remodel his/her home, repair damages to the home, pay college tuition, or to provide care for any dependents. In many instances, the lender who provided an individual with an initial mortgage will also provide him/her with his/her second mortgage, though an individual can apply with a different lender.
