While Second mortgages are not a focus for Efinity Home Loans, they can be a useful tool for a client interest in a home equity second lien or a home purchase transaction. Not all mortgage lenders can offer second liens in Texas however Efinity Home Loans is equipped to offer Second liens for many reasons including those listed below.
For home purchases second liens are great idea for the following:
- Avoid or limit your down payment
- Avoid Private Mortgage Insurance (PMI)
- Qualify for a better rate on your primary first lien
- If you are selling a home you can use a second lien as a buffer until you sell your prior residence and then pay off the second lien and be left with a low rate first lien.
- It may provide the only way to finance the home under the payment terms you wish
If you are on title to a home you may utilize a second lien for the following purposes:
- Home Equity loan to consolidate debts or get cash
- Home Equity Line of Credit (Completely different than a home equity loan)
- Home Improvement
Be aware that second liens may have the following characteristics:
- Many are on 30 year fixed rate mortgages
- Some may have a shorter term like 15 or 10 years
- Many are on balloon notes like a 30 year fixed mortgage due in 15 years
- Some have adjustable rate terms
- Some may have interest only terms
- Due to the inherent risk for the second lien lender, second mortgages typically have rates 1% to 4% higher than first lien rates.
Contact us to learn more about second mortgages.