A second mortgage is a chance to take advantage of the equity you have built up in your home and turn that into a lump-sum payment of cash or a line of credit to use at your discretion. These are often referred to as home equity loans.

This payment or line of credit is essentially another mortgage that is secured with the equity in your home. While there are many similarities with a first and second mortgage, there are distinct differences

• second mortgages often carry higher interest rates than first mortgages


• often second mortgages have shorter repayment schedules


• often second mortgages are fixed rate loans with predetermined payment schedules, however adjustable rate mortgages (ARMs) do exist.


• second mortgages can be paid out in a lump sum cash distribution or as a home equity line of credit (heloc) that you can write checks against as you need it

Financial Partners can help determine what is right for your specific needs. You can contact our offices or start the process online and save some time and effort.

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The benefits of a second mortgage can help organize your financial life and offer some tax relief come April 15. Second mortgages and home equity loans can pay for a myriad of big-ticket expenditures such as college tuition, home improvements or even debt consolidation.

Often the rate on a home equity loan is much less than the high rates credit card companies charge for balances. By using the cash payout to pay off the card balances you can save yourself from hefty finance charges. However, keep in mind that running the balances up again would negate any advantages of the loan.

Additionally, the interest charged on a home equity loan is often deductible from your taxes. While this is the case in many instances, please check with your tax advisor for your individual situation before taking out your loan.