Second Mortgage
Second Mortgage Benefits
Access Home Equity
Tap into your home’s equity for major expenses or opportunities without affecting your first mortgage.
Fixed Monthly Payments
Enjoy stability with a fixed rate and set monthly payments—unlike HELOCs with variable rates.
Lump Sum Distribution
Receive funds as a one-time lump sum—great for renovations, debt consolidation, tuition, or large purchases.
Lower Interest Than Personal Loans
Secured by your home, second mortgages often have much lower rates than credit cards or unsecured loans.
Flexible Terms
Pick a repayment term—5, 10, 15, or 30 years—to match your goals and cash flow.
Potential Tax Benefits
Interest may be tax-deductible if used for home improvements (consult your tax advisor).
Eligibility Requirements
Home Equity
Must have at least 15–20% equity after the new loan. Combined LTV typically capped at 80–85%.
Credit Score
Minimum 660–680 for most lenders. Higher scores get better rates and easier approval.
Debt-to-Income Ratio
Combined monthly debts (including both mortgages) must usually stay below 43–50% of your gross income.
Income Verification
Stable, documentable income—most lenders want 2 years of steady employment or self-employment.
First Mortgage Standing
Your first mortgage must be current—no recent late payments or delinquencies.
Property Requirements
Property must meet lender requirements and pass an appraisal to verify value.
Second Mortgage Process
Pre-Qualification
Quickly review your options and eligibility with a loan specialist.
Application
Complete a full loan application and gather required financial documentation.
Home Appraisal
A professional appraisal determines your home's value and available equity.
Underwriting
Your loan is reviewed for final approval based on all criteria.
Closing
Sign documents and receive your funds as a lump sum.
Second Mortgage vs. HELOC
| Feature | Second Mortgage | HELOC |
|---|---|---|
| Fund Distribution | One-time lump sum | Draw as needed |
| Interest Rate | Fixed | Variable (often) |
| Monthly Payment | Fixed | Varies |
| Term Length | 5–30 years | 10–30 years (draw + repay) |
| Best For | Large planned expenses | Flexible/ongoing needs |
| Interest Accrued | On full amount | Only on used portion |
| Closing Costs | Generally higher | Often lower |
Ideal For Second Mortgage
- One-time, large cash needs
- Predictable fixed payments
- Debt consolidation
- Home improvements
Ideal For HELOC
- Ongoing or variable expenses
- Only pay interest on funds used
- Need flexibility in borrowing
What Our Clients Say
Michael & Sarah T.
Denver, Colorado
Robert L.
Austin, Texas
Jennifer W.
Seattle, Washington
Frequently Asked Questions
What is a second mortgage?
A loan secured by your home in addition to your first mortgage, letting you access home equity as a lump sum without refinancing your main loan.
How does a second mortgage differ from a HELOC?
Second mortgages are fixed-rate, fixed-term loans paid as a lump sum. HELOCs are flexible lines of credit with variable rates and draw periods.
How much can I borrow?
Typically up to 80–85% of your home’s value minus what’s owed on your first mortgage.
What are typical terms?
Usually 5–30 years with a fixed rate and payment.
What are closing costs?
Usually 2–5% of the loan amount (may be built into the loan or covered by a higher rate).
Can I get a second mortgage with bad credit?
It’s possible, but most lenders want a minimum 660–680 score. Subprime lenders may charge more for lower credit.
Is the interest tax-deductible?
Only if used for home improvements (consult a tax professional for your specific situation).
What are the risks?
Your home is collateral for both loans—missed payments could mean foreclosure. Only borrow what you can repay.
Ready to Explore Your Second Mortgage Options?
Our mortgage specialists are here to guide you and find the right solution for your needs.
Get Started Today
E Mortgage Capital, Inc. is a full-service mortgage company that offers extensive options for residential mortgages, with quick service and leading rates
E Mortgage Capital. Inc.
NMLS#: 1396861
915 Highland Pointe Dr, Roseville, CA 95678, USA
3401 Mallory Ln, Franklin, TN 37067, USA
18071 Fitch, Irvine, CA 92614, USA
Notice To Texas Loan Applicants: Consumers wishing to file a complaint against a mortgage banker, or a licensed mortgage banker residential mortgage loan originator, should complete and send a complaint form to the Texas Department of Savings and Mortgage Lending, 2601 North Lamar, Suite 201, Austin, TX 78705. Complaint forms and instructions may be obtained from the department’s website at www.sml.texas.gov.
A toll-free consumer hotline is available at 1-877-276-5550. The department maintains a recovery fund to make payments of certain actual out of pocket damages sustained by borrowers caused by acts of licensed mortgage banker residential mortgage loan originators. A written application for reimbursement from the recovery fund must be filed with and investigated by the department prior to the payment of a claim. For more information about the recovery fund, please consult the department’s website at