Article: Why Take A Second Mortgage
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Why Take A Second Mortgage
A second mortgage is a mortgage whose terms are subordinate to the first mortgage. Loans with a second mortgage are usually done when the homeowner needs money in order to pay for an existing loan.
Second Mortgage or Refinance?
This is a question every homebuyer is faced with when shopping for mortgages. Take this scenario: A homeowner is facing a credit card debt of $50,000. Should he take a $190,000 second mortgage to refinance an existing mortgage with a balance of $140,000? Or should he borrow the money from a $50,000 home equity loan?
In most cases, borrowers who took a mortgage when rates were lower will find a second mortgage better than a home equity loan. But to be certain, some factors need to be considered.
You need to...
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