With the Fed chairman continually raising interest rates, the refinance boom for first mortgages may be over. In the last 3 years, millions of homeowners were fortunate enough to lock into thirty year fixed rate mortgages at 5.5%. With the market shifting and the rates climbing, it's time to consider second mortgages for getting cash.
Clearly, the demand for money still exists, but consumers are looking for alternatives to refinancing their existing 1st mortgage. Most homeowners don’t want to touch their 5.5% thirty year fixed rate loan. These same homeowners are much more excited about getting their cash through a second mortgage loan. Sure the interest rates are higher with a 2nd mortgage, but it is a great solution for someone who needs cash but doesn’t want to refinance their low rate mortgage. With the market changing, loan officers who offer second mortgage products could have some good years ahead of them.
Popular Second Mortgage Programs
125% Second Mortgage- No equity is required!. You can borrow more than your home is worth. These are great fixed rate loans for first time homebuyers looking to make so home improvements or consolidate debt. Credit scores need to be good, and residual income needs to be over $3,000 a month in most cases. No mortgage insurance is required!
· Full Documentation Required
· First Time Homebuyer OK
100% Second Mortgage Fixed Rate- Fixed payments and fixed rates make people feel secure. There is no better way to consolidate credit card debt or make home improvements. There is a wide range of credit allowed up to 100% CLTV. (Poor, fair & good credit) Debt to income ratios are allowed up to 55% with some programs. Some loan programs will go to 100% behind a negative amortization or a balloon loan. No mortgage insurance is required!
· Stated Income Loans Available
· Primary Residence or Second Homes
100% Home Equity Line of Credit –Variable Rate- Interest only payments have become very attractive to homeowners seeking to increase their cash flow. Home equity lines are more flexible than fixed rate second mortgages, because you don’t have to access all of the money at once, and you only make payments on the portion of the equity line that you accessed. There is no better form of funds for emergency purposes than a home equity line of credit. If you never need to touch the funds, then you never pay any interest. There is a wide range of credit allowed up to 100% CLTV. (Poor, fair & good credit) Debt to income ratios are allowed up to 55% with some programs. No mortgage insurance is required!
· Stated Income Loans Available
· Primary Residence or Second Homes
Barry Donavan is an experienced writer who focuses on home finance and consumer credit. You can read more of his mortgage finance articles at http://www.bdnationwidemortgage.com and get more information about home equity loans and mortgage refinancing.
For a complete look at second mortgage loans please go to http://www.bdnationwidemortgage.com/second_mortgage.html.
