Second Mortgage

Access the equity in your home without being forced to sell

Second Mortgage

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Is a second mortgage right for you?

When people think of a second mortgage, they usually think of high-interest rates, large fees and a big loan shark preying on their property. But, in reality, a second mortgage can be a great way for homeowners to fulfil other endeavours without having to sell their home.

A second mortgage is a type of loan that allows you to borrow against your existing home loan. It is an additional loan taken out on a property that is already mortgaged. And, yes, they do come with a slightly higher interest rate but only because it’s considered a riskier investment than a first mortgage.

However, these rates are still significantly lower than high-interest credit cards, car lease payments or unsecured lines of credit. Your home is possibly your biggest asset, and over time that asset becomes more valuable. The value gained is equity that you can utilize to fulfil other financial goals or projects.

A second mortgage can help you consolidate your debt and improve your credit score, allowing you to qualify with a prime lender sooner than you would otherwise. Beyond debt consolidation, a second mortgage can be used to finance other life events such as higher education, vacations or home improvements.

At Everything Mortgages, we have access to a network of second mortgage lenders, both institutional and private. Our mortgage specialists can match you with a lender in as little as 48 hours regardless of your credit, income and employment history.

Quick facts about the second mortgage

Higher approval rates

Lenders offer more lenient qualification requirements.

Shorter loan terms

Lending is short-term ranging from 6 months to 1 year.

Quick turn-around times

Closing can be as quick as 48 hours.

Lower rates

Lending rates typically start at 5.99%, which are lower than other high-interest credit options.

Additional fees

You may pay a lender fee of 1.5% to 2%.

Frequently asked questions

What is a second mortgage?
A second mortgage is an additional loan taken out on a property that is already mortgaged. Determination of first, second and third mortgage designation is determined by priority of registration.

What this means is if you have a first and second mortgage on your property and if for some reason you went into default – the mortgage in the first position will recoup their investment first followed by the second mortgage. It’s considered a riskier investment for the lender which is why second mortgages typically have higher interest rates than first mortgages.
How can a second mortgage help me?
Second mortgages are rapidly growing. It’s a great way for homeowners to access equity in your home without being forced to sell or pay a huge penalty when breaking your existing mortgage. Refinancing rules allow you to access up to 80% of the equity in your home.
How can I qualify for a second mortgage?
In order to qualify for a second mortgage in second position, lenders will look at four areas:

Equity. The more equity you have available, the higher your chances of qualifying for a second mortgage will be. If you are purchasing a house, a larger down payment also decreases the risk that a lender takes on.Regular payments towards utilities, telecommunications, insurance, etc, and/or confirmation letter from service provider(s).

Income. Lenders want to verify that you have a dependable source of income, to ensure that you can make payments.

Credit score. The higher your credit score, the lower your interest rates.

Property. Because other factors are risky (i.e. your credit score), lenders need to secure their investment in case you are unable to keep up with mortgage payments.
How does a second mortgage work?
The amount you can borrow will depend on the equity you have in your home. The total of a first and second mortgage can be as much as 80% of your home’s value. Consider you own a property valued at $500,000, and your first mortgage is for $325,000. In this case you’d be able to access $75,000 upon obtaining a second mortgage if approved.

How can you use a second mortgage?

Home Renovation

Credit Improvement

Debt Consolidation



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