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Second Mortgage
Why Take Out a Second Mortgage?
Traditional Second Mortgage
Home Equity Line of Credit (HELOC)
Preparing Your Credit
Preparing to Apply
Understanding Fixed Rates
Understanding Adjustable Rates
Shopping for a Lender
Locking in a Rate
Understanding Points
High-Interest Debt: A Way Out
Paying for College
Home Renovation
Using the Internet to Research
Payment Comparison
An Affordable Monthly Payment
Private Mortgage Insurance
HELOCs and Monthly Payments
The Role of the Loan Officer

The Role of the Loan Officer

You have done your research and made the decision, a second mortgage is the answer to your need for cash. You will finally be able to put in that new bathroom!

As you begin the application process, you are understandably a little nervous. What type of paperwork will there be? What documents do you need to prove residence, income and employment? How will the second mortgage loan affect, if at all, your original mortgage loan and vice versa? Will there be tax advantages to taking out a second mortgage loan? How much will your monthly payment be on the new mortgage loan? Should you get an adjustable interest rate or go with one that is fixed? How do current interest rates seem to be moving, and can a big change be anticipated in the future?

Which is better for you, a home equity line of credit or a traditional second mortgage loan? If you do choose a home equity line of credit, what are the lending institution’s policies regarding minimum withdrawals and monthly payment requirements?

Your loan officer is there to help. He or she is familiar with the mortgage loan business and the financial industry in general, and will be happy to give you the benefit of their expertise and experience as they guide your through the application process for your second mortgage loan.

The loan officer knows all the details about your new mortgage, so do not be afraid to ask any questions you may have. Remember, putting your family home on the line to guarantee repayment of a second mortgage means you must be serious about the attendant repayment obligations, and you must understand any terms to which you agree.