2nd Mortgage Loans - Extra Cash, Extra Risk?

2nd Mortgage Loans - Extra Cash, Extra Risk?
By Harris Fallon

A 2nd mortgage loan allows a homeowner access to the equity in his home. This is the appraised value of the property less the amount of the first mortgage. Traditionally, second mortgage loans were used to finance improvements.

Homeowners might remodel the kitchen, add a deck or finished the basement to provide a family room or home theater. The equity was used to send students to college or to provide startup capital for a small business. The second loan for most homeowners was a one-time loan meant to cover a specific purpose.

Twenty years ago only the most credit worthy individuals could qualify for a second mortgage that, when added to the first mortgage, would total more than 80% of a home's value.

When mortgage interest rates declined in the early 2000s, second mortgages became more common. A contributing factor was the housing bubble that caused home prices to rise by double digits annually in many parts of the country.

Large financial institutions began to ease the underwriting restrictions on second mortgages in the 1990's and by 2001 a homeowner could leverage 100% of the value of his home with a second mortgage loan.

The low interest rates were attractive to homeowners. It has been common for those living above their means to consolidate their debt with a second mortgage on their home by refinancing the second mortgage year after year.

In the past, a 2nd mortgage could be expected to be at a higher rate of interest than the first mortgage on a property. Variable rate second mortgage liens were offered with initial interest rates as low as 3%. Some homeowners began to use the equity in their home as a mini-bank.

They would take a 10 year second mortgage to pay off credit card debt and their monthly payments on the new loan would be substantially less than the payments made on the high interest credit cards.

However, it is important to realize that when you take a second mortgage loan on your personal residence, you are in a position of increased risk. Almost all second mortgage loans have a cross default policy.

That means failure to pay the second loan will cause the first mortgage to go into default and you may lose the home through foreclosure. In the current economy, the rapid decline in home values has meant thousands of homeowners now have first and second mortgages that are much higher than the market value of their home.

Equity in your home is like have emergency cash in a bank account. Homeowners who treat the cash generated by such a loan as an excuse for a shopping spree may find themselves struggling to keep their home.

Used wisely, a second mortgage loan is an option available to pay for medical expenses, college tuition, or to improve your property. Used unwisely, homeowners may find themselves facing the loss of their home altogether. As such, you should weigh the extra cash that you generate with the extra risk you will take on before deciding to take on a second mortgage for your home.

Harris Fallon is a Virginia based homeowner who frequently writes about mortgage loans and real estate financing for residential properties. You can read more about Virginia 2nd mortgage loans, financing tips and homeowner considerations at http://www.virginia2ndmortgage.org.

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2nd Mortgage Loans - Extra Cash, Extra Risk?

2nd Mortgage Debt Consolidation

2nd Mortgage Debt Consolidation
By Kristy Annely

Consolidation of debt mortgage loans helps you repay your debt quickly. A second mortgage debt consolidation is the process of consolidating second mortgage loans on the existing property, mainly with a view of paying off the early mortgages.

Debt consolidation mortgage loans are designed to ease your monthly repayments by consolidating all your existing debts into a single loan with a single monthly payment. Debt consolidation not only reduces interest rates, but also eliminates late fees. As the monthly payment comes down considerably with reduced rates, repayment of debt is accelerated.

The second mortgage plan places an additional mortgage on your property. You are bound by a fixed monthly payment and fixed rate of interest in the second mortgage debt consolidation. Refinancing of an existing property is possible only when there is adequate equity to do so. You can also negotiate with your lender for a stand-alone loan.

Second mortgage debt consolidation loan gives you much lower rates compared to credit card and other loan rates. Consolidation of debt with second mortgage or home equity will give you a better monthly repayment plan. A debt consolidation will help you keep your credit history on the right track.

The additional amount you make through the second mortgage is tax deductible also. The maximum amount you can borrow by the process of second mortgage debt consolidation is the total value of your home evaluated at low market value. Even if the consolidation results in an increase in monthly repayments, you could meet some current cash demand.

2nd Mortgage provides detailed information on 2nd Mortgage, Refinance 2nd Mortgage, Bad Credit 2nd Mortgage, 2nd Mortgage Loans and more. 2nd Mortgage is affiliated with 1st Mortgage Rate.

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2nd Mortgage Debt Consolidation

Bad Credit Second Mortgage Loan - Guide to Remortgaging

Bad Credit Second Mortgage Loan - Guide to Remortgaging
By Rob Small

With the housing market in decline, and fewer home loans being paid out every month, it can be especially difficult to find a second mortgage loan - particularly if you have bad credit.

A second mortgage, however, could be yours if you are able to find the right lender. And one of the easiest ways to find a suitable lender is to employ a broker.

They will search through hundreds of different lenders to find a second mortgage loan that suits you and fits with your budget. They will take interest rates, fees, charges, loan terms and conditions into account while looking for a lender who can offer a loan you are happy with.

This is much simpler and more efficient than searching for a lender directly. After all, when you contact one lender, you will only be able to compare the loans they have on offer.

On the other hand, contacting several lenders is both time-consuming and complicated. Working with a broker can make things much easier.

You can use a second mortgage loan for almost any purpose. One of the most popular reasons to remortgage is to fund home improvements. However, you may also want to switch mortgage lender or renegotiate with your current lender.

If you have bad credit, a second mortgage with lower interest rates can cut down on your monthly repayments. This can free up extra money, meaning you can save more every month.

You may want to take out a second mortgage to fund a buy-to-let purchase. You will often have to prove that the rental income will cover 130% of the mortgage payments when applying for a buy-to-let loan, so it is important that you have all your figures correct.

A broker will be able to help you when applying for a second mortgage loan. They will be available to answer all of your questions, so your application is more likely to be successful.

Whatever the purpose is, working with a broker takes the hassle out of hunting for a bad credit second mortgage loan.

Gordon Parkes is an expert author with a great interest in the financial industry. He has written extensively about obtaining a second mortgage loan and how you can benefit from a bad credit second mortgage.

Article Source: http://EzineArticles.com/?expert=Rob_Small

Bad Credit Second Mortgage Loan - Guide to Remortgaging

Stripping a Second Mortgage From Your Home in Chapter 13 Bankruptcy

Stripping a Second Mortgage From Your Home in Chapter 13 Bankruptcy
By Joseph Seagle

In Bankruptcy cases, specifically Chapter 11 and Chapter 13, lien stripping is an effective tool in reducing the payments made to creditors. In Chapter 13, the debtors reorganize their debts into a repayment plan whereas Chapter 11 is for businesses and individuals whose debts exceed the limits in Chapter 13.

Lienstripping is referred to as the debtors' ability to reduce an undersecured creditor's claim by valuation of the underlying collateral. This is also known as bifurcation where the undersecured creditor's claim is divided into secured portion and unsecured portion.

The unsecured portion of the lien is stripped away from the collateral and becomes an unsecured claim. For example, if a debtor purchased a commercial building with a mortgage of $500,000 and the current value of the building is $300,000.

The creditor's lien is undersecured and can be bifurcated into $300,000 secured claim and a $200,000 unsecured claim. The debtor is only required to pay back $300,000 over the life of the loan and the remaining $200,000 can by discharged at the end of a successful plan.

Under nonbankruptcy laws, the debtor is required to pay the entire amount since lienstripping is unique to bankruptcy cases. Lien stripping is not available in Chapter 7 cases which are used in discharging unsecured debts because liens ride through Chapter 7 cases untouched.

However, there are limitations as to what the debtor can do in valuing claims on the primary residence and vehicles financed within 910 days. Congress in its wisdom has prohibited individuals from modifying loans on their primary residence.

If the debtors have one mortgage on their home, they cannot reduce the loan to the value of the house. However, the debtor is allowed to strip away a second mortgage that is not secured by the value of the house. For example, if the debtor has a first mortgage of $300,000 and a second mortgage of $100,000 and the house has a value of $250,000, then the debtor is allowed to strip away the second mortgage.

In Chapter 13 cases, Congress applied another limitation to stripping liens on vehicles financed within 910 days of filing bankruptcy. A vehicle that has been financed longer than 910 days can have its lien reduced to the value of the collateral which allows the debtor to make reduced payments based on the current value of the vehicle and not the outstanding balance of the loan.

The interest rate can also be reduced to the current market rate and the debtor is not required to pay the contract rate.

Joseph E Seagle, PA offers debt relief services to clients in the Central Florida area.
http://www.filemybankruptcynow.com

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Stripping a Second Mortgage From Your Home in Chapter 13 Bankruptcy

A 2nd Mortgage Loan - Potential Benefits

A 2nd Mortgage Loan - Potential Benefits
By Rob Small

Taking out a 2nd mortgage loan is a fast and effective way to free up extra cash, possibly for home improvements, a new car, a much needed holiday or almost any other purpose.

When looking for a 2nd mortgage loan, it is important that you get the right advice. Go to a lender or broker whose advisors will give you unbiased guidance and will fully understand your needs.

They will then be able to find a second loan that meets all your requirements, while keeping interest rates and charges low.

There are many advantages of going to a broker to find your remortgage loan. They will be able to search quickly through hundreds of loans to find the right one for you. This really takes the hassle out of hunting for a low-cost mortgage.

It also means that you get a bargain from a lender whom you might not have considered if you had been carrying out a manual mortgage search.

Whether you are looking for a mortgage to move house, or want a 2nd mortgage loan to fund other projects, finding the right lender can save you thousands of pounds. If you find your second loan through a broker, you could benefit from:

o Acceptance of employed and self-employed borrowers.
o Self-certification allowed.
o Fast decisions and pay-outs.
o Low fixed rates.

Brokers will be able to find mortgage deals for all circumstances, even if you have adverse credit, CCJs or have defaulted on loans in the past.

Another reason to choose a broker when looking for a second loan is the support you will receive.

Mortgage applications can be highly complex, and a broker can assist you during the application process. This can involve explaining any fees or charges, such as Early Repayment Charges.

The ERC is a charge imposed by a lender if you redeem your mortgage within a set number of years. Many loans that have low introductory rates include Early Repayment Charges.

Working with a broker means you will be guided through any charges, so you will be able to find the second loan that meets all your requirements and fits your budget.

Gordon Parkes has written many articles about remortgaging and other secured loans. Find out more about the benefits of taking out a 2nd mortgage loan.

Article Source: http://EzineArticles.com/?expert=Rob_Small

A 2nd Mortgage Loan - Potential Benefits

The Dirty Little Secret About 2nd Mortgages

The Dirty Little Secret About 2nd Mortgages
By Andy Faria

The dirty little secret that the servicers of second mortgages and equity loans don't want you to know is that the borrower holds most of the leverage when they fall behind on the monthly payments. These type of loans always fall into place behind the first mortgage.

This means that should the home be lost to foreclosure or sold through short sale, the second mortgage won't get a dime until the first mortgage is satisfied in full. With the recent and sudden drop in real estate values nationwide, this means that most of the time, a second mortgage is wiped out or sold off as a total loss in cases of foreclosure or short sale.

Many people will contact their second mortgage when they initially fall behind on payments are shocked to find that the lender will offer a loan modification very quickly and easily. These modifications will generally lower the payments for a period of time to allow the borrower to "get back on their feet".

In reality, these plans are usually far from the best they can offer and many times don't provide any kind of long term relief. Most people accept these plans gratefully and begin making payments again not realizing that they just settled for less than they need to and did not successfully capitalize on their position of leverage.

A second mortgage does have the ability to foreclose on a property if the payments go beyond ninety days behind. This "right to foreclose" was written into the original loan documents; however the only reason they would ever foreclose is if the property has a sizable amount of equity and the foreclosure would make financial sense.

It would need to give them the ability to not only clear the first, but retain a profit for themselves. In fact if the second mortgage foreclosed they would be doing a huge favor for the first mortgage.

The second would now own the property and have to keep everything current, the property taxes (plus any back taxes), the heat (so the pipes don't freeze), repairs, and they would also shoulder the costs of selling the property and paying off the first.

These expenses many times add up to more than they are owed in total on the second mortgage or equity loan. This is why the borrower has much more leverage with a second than with the first. If the value no longer remains in the home, what is protecting the second? Nothing, collection is basically no more enforceable than a credit card debt.

The trend over the past 12-18 months has been that the lender of a second mortgage will only hold a loan until it goes to about six months behind. They have been treating these debts as a "charge off" at that point.

This means that the lender has declared the debt as uncollectable and the debt is no longer considered an asset within the bank. The debt is usually sold off to a debt buyer for a fraction of what the principle balance is.

If a second mortgage is "charged off" the debt is no longer attached to the property in most cases and the new debt buyer will not have the right to foreclose anymore. They still have the right to try to collect the balance and the debt will still appear on the borrowers credit report until it is either "satisfied in full" or "settled" for less than the full balance.

Settlements on a second mortgage or equity loan can go as low as 10% and offer the borrower the opportunity to save a huge amount of money when compared to the cost of remaining in the loan and paying month to month until the debt is paid under the lenders terms.

If a borrower is having trouble keeping up with payments on a second mortgage or equity loan they should certainly look at all options to modify the loan and save money. Many people are faced with the harsh reality that their home is worth more than they owe.

Modifying or settling their second mortgage may very well be the best opportunity to reduce the principle balance owed and get the property "back above water".

The author has been on the front lines of the "economic crisis" since the beginning and continues to fight for consumers nationwide.

Northeast Settlement Group Inc 866-794-1869 Toll Free

Recent Bank of America Success Stories

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The Dirty Little Secret About 2nd Mortgages

Understanding Second Mortgages

Understanding Second Mortgages
By Rachelle Vasser

If you have debt you need to consolidate or you want to reduce the initial investment required to finance your first mortgage, you should consider second mortgages. But second mortgages often come with consequences, so do not be frivolous with them. Learn what they are and how they work before you seek one.

What Is A Second Mortgage?

A second mortgage is literally what it its label implies; it is an additional loan you take to supplement the first loan. This can be used in any kind of property, be it an auto loan, financing for a boat or a home mortgage. Generally I deal with second loans having to do with homes, so that will be the focus of this article.

Often, people don't even realize they can obtain a 2nd mortgage. In fact, it isn't uncommon in real estate for a property to have multiple loans handling its expense.

It Isn't An Out From Responsibility

One misnomer, however, is that such loan can be obtained to save your butt on your first loan. This just is not the case. If you are struggling to keep up with your first mortgage, do not expect your lender to give you a second mortgage.

Banks and lenders are in the business of making money. Especially in the current economic climate and in the aftermath of the sub-prime lending crisis, lenders are not interested in giving loans to people who can't pay off their current debt.

However, if you can show that you have been responsible with your first loan, obtaining that 2nd loan may be an excellent way to consolidate your debt or finance some nice upgrades to your property.

2nd Mortgages Carry High Interest Rates

One thing to keep in mind, however, is that these additional loans are considered to be subordinate to the primary loan. So if you should default on your home financing, any kind of foreclosure would go towards paying off the first mortgage before the 2nd mortgage.

This makes secondary mortgages more risky for lenders. Thus you can expect to pay a significantly higher interest rate for second loans even if you have good credit. Because of that higher interest rate, it also makes them a little more risky for you because you will have a higher monthly payment earning you less equity per dollar paid.

So while I advise you to not ignore second mortgages, be sure you understand what you're getting into before you commit to the additional investment and higher interest rate.

Learn how second mortgages help you obtain 0 down home loans at my comprehensive new website where I dispel the myth of the no money down home mortgage.

Article Source: http://EzineArticles.com/?expert=Rachelle_Vasser

Understanding Second Mortgages

Should You Go For a Second Home Mortgage?

Should You Go For a Second Home Mortgage?
By Eustacia Parker

If you want to buy yourself a second home or a vacation home near the ocean, on a lake or in the mountains, you can go for second home mortgage. You can also use this extra cash for many other reasons like, paying off your credit cards or buying a car.

What a second home mortgage is

Second home mortgage is a mortgage on a property in which you are not currently living. It is not necessary for you to have a mortgage on your first home.

If you do not want to live in the home that you want to buy and want to stay elsewhere, then also the mortgage will be considered as a second home mortgage. So, in short, it can be said that second home mortgage is a mortgage on a property that is not your primary residence.

Benefits of second mortgage

Some of the benefits of second mortgage are mentioned below:

• The underwriting guidelines for a second mortgage are not as strict as the first mortgage.
• Though the lenders charge a large down payment and a high interest rate for the second mortgage, but, the transaction fees in some cases may be lower than that you need to pay for a refinance.
• It also takes less time than to refinance your loan.
• You can get additional cash at your hand to fulfill your emergency needs like paying off your credit bills, making payment towards another loan, financing your child's education, etc.

If you have plans to sell your home in the near future, then opting for a second mortgage will not be a good choice. The lenders generally charge a higher interest rate and a higher down payment for second home mortgage.

They consider you financially risky having more chance of being a defaulter, as you have to make payments for two mortgages. If you plan to give out your home for rent, the lenders will want you to put down an even more amount towards down payment. So, it would be better to refinance your first mortgage or take a home equity loan on it.

Eustacia Parker is a deliberate writer for californialoans.org. Her writings include home loans, auto loans, personal loans, second home mortgage etc. She is a financial writer by profession and has specialization in dealing with financial problems and its solutions.

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Should You Go For a Second Home Mortgage?

Second Mortgage Foreclosure and How to Dodge It!

Second Mortgage Foreclosure and How to Dodge It!
By Chad Scott

Second mortgage foreclosure doesn't have to be as ominous as it sounds. Yes, the prospect of losing a home is frankly very scary, but you have to realize that the Government is trying it's best to protect your home. President Obama's bills are definitely witness to that!

Help...From The President

An $75 billion plan to help stop foreclosures is what President Obama offered us last year, so a second mortgage foreclosure will not be as inevitable as it used to be earlier, but in spite of this, many of us, in these times of recession fail to pay our monthly mortgage bills.

Under the terms in your average deed of trust, a second mortgagee can actually initiate the process of foreclosure if you, as a borrower have defaulted on your payments of the first or the second mortgage on your home. That is the ugly truth and there's no way of dressing it up nicely!

Smart Moves

At the same time, let me tell you that by acting fast and smartly, you can save your home from foreclosure. If you have any additional assets such as jewelry, an extra car or anything which has high resell value, by all means use them in order to make payments.

While this might not close the loan for you, this might just tide you over for a bit. The basic thing you have to remember is that you have to show your lender that you are in fact, interested in repaying your loan! This fact has to come across and maybe you're mortgagee is going to show some mercy on you.

A Friendly Warning

Also, another thing to beware of is foreclosure scams and people contacting you over the phone. Many people and companies will come to your rescue, or so they would like you to believe. But all they want to do is drain you of all your money. So you need to be careful in these trying times.

You need to do everything in your power to save your house. You cannot do that if you lose hope. Check out resources and plans to help you avoid foreclosure. Second mortgage foreclosures are ugly, but the great part is there is hope and you can avoid it!

Chad has a 10 year history in the mortgage and credit business. He shares his knowledge on mortgage and credit related topics, including second mortgage foreclosure. For more foreclosure information, you can view his site at Stop a Foreclosure.

Article Source: http://EzineArticles.com/?expert=Chad_Scott

Second Mortgage Foreclosure and How to Dodge It!
By Chad Scott

2nd Mortgages - Finding the Lowest Current Rates on 2nd Mortgage Loans

2nd Mortgages - Finding the Lowest Current Rates on 2nd Mortgage Loans
By Kevin Benner

As we should all know by now, not all 2nd mortgages are created equally. Homeowners often find themselves submitting the same information to several different mortgage lenders only to end up with cost, rates and fees that are all across the board.

This is because lenders often times have different underwriting guidelines, fees and terms with which they use to determine a consumers mortgage pricing. While one lender may specialize with borrowers who have an excellent credit score, others may deal primarily with those consumers with a less than perfect credit history.

By comparing multiple 2nd mortgage rate quotes from different lenders you can see what broker can provide you the best rate at the lowest cost with the most favorable terms.

This will allow you to make a much more educated decision as to what loan option best fit your current financial situation. You must remember though that the lowest interest rate does not always lead to the best deal on a second mortgage.

For example, an introductory rate on an adjustable loan may seem very low but it often can lead to much higher rates and payments later in the life of the loan. Other loans may have fees hidden in them which would make it expensive to refinance out of later. This may hurt your ability to lock in a lower rate should refinance rates go lower.

Get Free Quotes for 2nd Mortgages Right Now

Finding low rate quotes for the 2nd mortgage you desire may take some time and research. Yes, it may seem time consuming but not taking the time to investigate your mortgage options could end up costing you in the end.

The internet is a perfect tool that can be utilized to find the right lender eager to earn your business. Completing a simple form on any one of the many quality mortgage resource sites online can provide you with rates from multiple brokers for your second mortgage. This will allow you to make an education decision on which option will work best for you.

Using the internet to compare quotes from multiple lenders will not only save you time but will help you maximize your chance of saving money. Do not waste any more time in finding the best home loan now. Use the power of the internet to find a low rate 2nd mortgage today.

Article Source: http://EzineArticles.com/?expert=Kevin_Benner

2nd Mortgages - Finding the Lowest Current Rates on 2nd Mortgage Loans

Modifying Second Mortgage Liens in Chapter 13 Bankruptcy

Modifying Second Mortgage Liens in Chapter 13 Bankruptcy
By Richard Feinsilver

If you are one of the many homeowners who purchased your primary residence with 80/20 mortgages, or if you took out a second mortgage in the past few years, did you know that you may be able to remove the second mortgage lien from your home in a Chapter 13 Bankruptcy?

Chapter 13 Bankruptcy offers an important, and often unknown and over-looked, option to consumers who have second and/or, perhaps third, residential real estate mortgage liens on their primary residences - namely, that of removing those junior liens from your home.

If the current fair market value of your home (as determined by an appraisal prepared by a licensed real estate appraiser) is below the present outstanding balance on your first mortgage (including arrears, if applicable), the second mortgage lien can be "stripped", and the debt associated with it can be reclassified as a unsecured debt (such as credit card debt, etc). This is also referred to as a "Cramdown" or "Lien Stripping."

The stripping/cramdown provisions in the Bankruptcy Code affecting second mortgage liens have been available to homeowners in Chapter 13 bankruptcy since 1994. This should not be confused with the bill proposed in early 2009 in Congress which sought to allow Bankruptcy Judges to modify mortgage liens (which was not passed).

That bill sought to expand the provisions that have been applicable to second mortgages to first mortgages. Even if you have already modified your first mortgage directly with your lender, or are in a trial modification on your first mortgage, this relief may be available to you.

While foreclosure remains the primary reason to file a Chapter 13 bankruptcy petition, individuals who may not be homeowners, or homeowners who are current on their mortgage obligations, but have incomes above the median income for their state and may not be eligible to file a petition for Chapter 7 bankruptcy can file a petition for Chapter 13 bankruptcy to effectively deal with their debts.

Chapter 13 bankruptcy is designed for working people with steady incomes who want to pay their debts but are currently overwhelmed with bills, judgments, lawsuits, and other financial issues. Even if you do not own a home, the filing of a Chapter 13 bankruptcy petition can assist you to regain control of your financial situation.

A Chapter 13 bankruptcy repayment plan allows an individual to repay mortgage arrears and some, or all, other their other debts (such as credit cards, medical bills, etc.), over a three to five year period. While a Chapter 13 plan is in effect, creditors cannot either start or continue their collection efforts, and they must accept what the plan pays them.

Any individual, or married couple, even if self-employed, can receive Chapter 13 bankruptcy relief if they owe less than $1,010,000.00 in secured debt (i.e. mortgages, car loans, equity loans), and less than $310,000.00 in unsecured debt.

In most Chapter 13 Bankruptcy cases, only a small portion of this type of debt is paid over a 3 to 5 year period. Immediately upon the successful completion of your Chapter 13 payment plan, the second (junior) mortgage lien shall be permanently removed from your property by Order of the Bankruptcy Court. Please be aware, though, that in order to qualify for this benefit, you must meet the usual and customary qualifications for Chapter 13 bankruptcy.

Article Source: http://EzineArticles.com/?expert=Richard_Feinsilver

Modifying Second Mortgage Liens in Chapter 13 Bankruptcy

Commercial Second Mortgage Rates

Commercial Second Mortgage Rates
By Ricky Lim

A commercial mortgage is what can be described as the use of real estate as collateral for a mortgage to secure payment. The difference between a commercial mortgage and a residential mortgage is only the type of land used.

The rates may slightly differ but they are generally the same. A commercial mortgage is also taken by a business entity rather than an individual borrower.

In this case you will find that the assessment of such collateral will be quite tricky. This has led to trickier commercial second mortgages. This type of mortgage is normally used in conjunction with a first loan that is new.

People who take commercial second mortgages should be sure to take such steps when there is no other plausible alternative. You will find that the two mortgages can be a problem to service and this might result in the loss of the property that was securing the mortgage.

At the same time, there are very many advantages that can come as a result of taking up this option.

The first advantage that one can get from getting this type of loan is what is known as a reduced LTV (Loan to Value) of the previous loan. This will mean that you will be able to easily qualify for the second loan.

A good example is when the first mortgage holder will give you a loan of 70% of the LTV. This will mean that you will only have a 20% down payment. In retrospect, this means that a second mortgage can be sued to make the difference.

This is what entails the basic process of any of the commercial second mortgages. Since the property is commercial, the idea is to let the property gain value.

Commercial property will appreciate in value at a stead and rapid pace. This appreciation will be faster than the interest rates that the mortgage company has given you.

This means that you can be able to get time to clear the first mortgage at a comfortable pace when you take the second mortgage.

This is why most of the financial advisors will tell business people to take commercial second mortgages so as to reduce the strain of paying the first mortgage.

This is the reason also the reason why the business that had a second commercial mortgage did not suffer when the global financial crisis and the recession hit the international economies.

Article Source: http://EzineArticles.com/?expert=Ricky_Lim

Commercial Second Mortgage Rates