2nd-Mortgage

When it’s time to find a second mortgage on your home, the time you spend looking for the right mortgage at the best rate can really pay off. There are lots of reasons someone might want to get a second mortgage. You could want to lower the amount you pay per month, consolidate your debts, build up some equity on your home, or get out of your first mortgage a lot faster. It doesn’t matter why you’re looking on second mortgage. What matters is paying attention to the important factors than can affect your mortgage.

Knowing the facts about a second mortgage and the remedies available to the borrower upon default is important considering the second mortgage will be secured against the borrower’s home.

A second mortgage with an initial value of less than £25,000 will be regulated by the Consumer Credit Act 1974.

Borrowers should be made aware that the Consumer Credit Act provides for a seven day cooling off period. During this time they can assess the terms and conditions of the second mortgage and redeem it if they feel the product is not right for their needs.

Where contracts on second mortgage has an arbitration clause then know that if you sign that contract you are giving up your legal recourse to the courts. IF you have to sign that can kind of document then make sure the Arbitrator is from an accredited association.

Because of the risks involved with borrowing money through a second mortgage, potential applicants should consider the downside carefully. Applicants should also consult with an independent mortgage broker to receive impartial and expert advice before securing a second mortgage against their home.