You’ve taken a look at what a second mortgage is and why you should take one out, but now you want to seal the deal. Always consult a mortgage broker near you to determine the best options going forward.
So, what are the benefits to having a second collateral mortgage?
Take a look at these six points to find out!
1. You can borrow a significant amount of money!
When you have a 2nd mortgage, you’ll be able to borrow a large sum of money depending on the value of your home.
Always ensure to consult with a mortgage agent to borrow within your means,
2. Interest rates are lower!
Your home is secured with your loan therefore, your lender is going to feel at ease in comparison to a unsecured loan. This may result in lower interest rates, in contrast to a unsecured personal loan. This will likely help you re-group financially and will save you money in the long run.
3. Tax benefits.
What is it you’re using your second mortgage for?
If you’ve chosen to use it to renovate or build a home, then your interest rates may be tax-deductible! Talk with your tax preparer and see if you’re eligible for any tax benefits.
4. Lower your monthly outgoing payments.
There’s plenty of reasons you may be taking out a second loan mortgage for instance, you may be in debt paying high interest rates and need some reprieve.
A second loan is great because you can use the money you have to be rid of any debt and in turn, this means you’ll have more money left over. Not only this, but by having fewer outgoing payments you may be able to pay back your loan faster, very likely resulting in less interest over the long-term.
You can also roll all your debts into one ( make sure to confer with a mortgage broker on this strategy), which makes it financially easier to cope with your outgoing payments, and be more aware of what’s going on with your finances.
5. You don’t need a perfect credit score!
If you have a bad credit rating then there’s no need to worry. Your second equity mortgage is based on the value of your home and is secured to it. Therefore, you’ll be able to borrow money in most cases, even if a personal loan hasn’t been approved.
This is especially great for anyone who is self-employed and struggling to keep a stable income.
6. You can payoff the balance upon maturity.
Once your finances improve, you can choose to payoff your lender upon maturity. This will also result in you paying less interest and your credit ratings will start to rise.
7. There are not many limitations.
Have you got an idea in mind you’d like to spend the money on?
Second position mortgages have no limitations on how you can spend the money you get. This is especially great for anyone who’s looking to invest their money or simply wants to spend their money on something they’ve been needing for a while, such as a car to get to work.
You’ve come to the end of this article and now it’s time to decide if these benefits are what you’re looking for. If you’ve found yourself in debt or simply just want to buy another home then why not take a further look into what your 2nd collateral mortgage can offer? You may find that under your unique circumstance your second registered mortgage can be more beneficial to you.
If you have any questions or concerns, reach out to us via our contact information below:
Toronto Second Mortgage
Broker 1880 O’Connor Dr
ON M4A 1W9