Stephen A. Dostal

SECOND MORTGAGES

A second mortgage is a junior lien that stands second in line to a first mortgage or in other words a second mortgage loan is subordinate to first mortgage loan registered against your property.

Your home can have multiple loans registered against it... first mortgage, second mortgage and even a third mortgage.

Some lenders refer to second mortgage as home equity loan OR home equity line of credit (HELOC), but if these loans are registered in your county registry office in behind your current first mortgage then they are second mortgages.

For Example:

Let's say your home value is $200,000 and you owe $120,000 to XYZ Mortgage Company who has a 1st lien registered against the title of your home at your county registry office. Your remaining home equity would be $80,000 (the difference between $200,000 home value and first mortgage balance of $120,000).

Now let's say you need $50,000 loan FOR WHATEVER REASON. You can tap into your available home equity and apply for a second mortgage (home equity loan or home equity line of credit) for $50,000 which will be registered in a 2nd position at the registry office behind XYZ Mortgage Company.