This type of loan is given its name because your first loan is the money you used to pay your house with and the second mortgage allows you to access the equity in your house. This equity might have been created by your regular repayments or through its current market value. It sounds tricky, doesn’t it?
Well, let’s look at an example, say that you have your loan with XYZ bank, worth $100,000. You then applied for a $100,000 loan with ABC bank. The loan with ABC bank is your 2nd mortgage. Let’s say you then don’t pay your loans to XYZ and ABC. Your property is sold for $178,000. XYZ bank is paid in full from the sale, however, ABC bank receives the $78,000. This means that you have to pay the remaining $13,000.
Talk with our award-winning Mortgage Domayne brokers, who are able to guide you through the process. We have access to second mortgages which are fixed rate or variable interest rates. Our various lenders offer ambitious rates, which may be better than going to the banks directly.
We also help with guarantor support. We help you to help out a loved one to invest in property by acting as a guarantee to your loved one’s loan by using their second mortgage over your property as additional security for the bank.
Contact us to learn about how you can secure a great second mortgage with a fantastic rate with our friendly and helpful brokers, who do not charge for these services. Let us remove the hassle and uncertainty that comes with accessing these loans.