* Second mortgages are different from first mortgages. They often carry a higher interest rate and are usually for a shorter period of time.
* Traditionally, second mortgage loans are offered with a fixed amount and a predetermined repayment schedule.
* Shop around and make comparisons when you are looking for a lender.
* Ask local banks, savings and loans, credit unions, or finance companies about their loan terms.
* Be sure to understand how much your monthly payments will be and what they include.
If you are like most homeowners, you probably have a first mortgage loan on your home. Typically, such loans are for 25 to 30 years, with the monthly payments adjusted so that the loan is paid in full at the end of the term.
As you make monthly mortgage payments and the value of the home increases, your interest in the property (called "equity") grows. After a while, some homeowners may wish to borrow against the equity in their home to get cash, to make home improvements, to educate their children, or to consolidate personal debts. Because such loans are in addition to the first mortgage on the home, they are commonly called "second mortgage" loans.
