A second mortgage loan is basically a second loan taken against an equity or property you own that has previously been, or is currently, mortgaged. The second mortgage can either be a home equity line of credit (HELOC) or a home equity loan depending on the borrower’s needs and is utilized by the borrower for several different things. Whether you need help with your children’s education, covering a portion of your initial mortgage’s down payment, financing home improvements, or debt consolidation, a second mortgage can help you with it all.
About a Second Mortgage.
Your second mortgage can be structured in two ways, either a standalone mortgage or a piggyback mortgage. The difference between these two is that a standalone mortgage is opened subsequent to the first home equity loan but a piggyback second mortgage is originated simultaneously with the primary loan. For a piggyback loan, you will have to pay off both of the loans at the same time, which is not ideal.
Second mortgages in Canada can also be taken in lump sums, where you are provided with a lump sum amount of money you can use for whatever you want. Regardless of which structure you use, a second mortgage can be very beneficial if used in the right circumstance and can also save your finances. Rather than drowning in debt and constantly having to use your limited cash to repay your debts and bills, taking a second mortgage and repaying those debts is an ideal task.
This will not only ensure you pay back the first loan and keep your house but will also give you enough finances to make enough money to not only pay back the second loan but also store money for you and your family’s future.
How do you get a second mortgage?
To be approved for a second mortgage, the borrower is likely required to have a credit score of 620 at the very least, but some individual lender requirements might be higher than that. Higher scores tend to correlate with better rates and can help you gain a good second mortgage. The borrower is mostly required to have a certain debt-to-income ratio, usually, it has to be lower than 43 per cent.
After being approved for the loan there are various aspects one needs to consider. Much like a home equity loan, a second mortgage takes financing charges and points into consideration, one of the criteria being the (APR), also known as the annual percentage rate which highlights the interest rate for the whole year. While applying for a second mortgage one should analyze and consider fees, this includes the equity loan processing fee as well as the application, underwriting, or origination fee.
As a borrower you have many expenses, some of them being the funding fee, lender fee, appraisal fee, document recording and preparation fee as well as a mortgage broker’s fee. So, it is important to ensure the lender you choose is worth all of these spendings and commitments.
Choose Freedom Capital.
Freedom Capital happens to be one of the most reliable lenders with their positions in British Columbia and Canada. Their priority is to create fast and simple access to the money you, the borrower, need. With products that aid them in first and second mortgages, as well as multimillion-dollar commercial and construction loans they are a reliable lender.
They not only provide creative financing options for their borrowers but also ensure that each borrower receives their desired second mortgages. While Freedom Capital provides second mortgages in British Columbia and Canada, they also provide construction loans and mortgage equity loans. But, while you pay off your second mortgage you also need to continue paying off your first mortgage which is secured against your home equity.
Freedom Capital happens to be the second-best mortgage in British Columbia and ensures that you agree to and understand all of the terms and conditions, settling on a mortgage equity loan that the borrower can provide for.
Considering the recent COVID 19 pandemic Freedom Capital has decided to provide their borrowers with better interest rates to ensure that the borrowers can provide for the monthly loan instalments. Usually, in such a trying time, people would be drowning in debt and due bills, unable to pay back any of their loans. But with Freedom Capital, you will be provided with a reasonable interest rate and quick approvals for your loans.
It is very hard to find a lender of high stature in British Columbia who can provide you with the type of loan, amount of money, and the exact interest rate you are searching for. With an empathic, reliable team and a company that strives to help people going through loss due to the pandemic, Freedom Capital should be your go-to.
They not only provide better interest rates, but Freedom Capital can also adjust the terms and agreements for your loan to create a time span and monthly deposit you can easily provide for. This is why if you’re seeking out a second mortgage in British Columbia, you should use Freedom Capital as your lender.