Mortgage Refinance Second
Refinancing your second mortgage could help you secure a lower monthly payment. A home equity line of credit and a home equity loan are two options that homeowners have for second mortgage loans. A home equity line of credit, or HELOC, is similar to a credit card because your balance fluctuates based on the usage of your credit line. The proceeds from a home equity loan are disbursed in a lump sum and will not allow you to draw additional funds. Both a HELOC and a home equity loan can be used to finance large projects such as home improvements, wedding expenses, college costs or debt consolidation. Either loan can be secured as a second mortgage lien.
1 Create a written plan that outlines your goals for refinancing. Your plan should include items that you want to consolidate, such as credit cards, student loans and your existing second mortgage. If your goal is to refinance and obtain a lower interest rate, your plan can indicate several ways that you could allocate your monthly savings.
2 Review a recent statement from your second mortgage lender, and call the customer service department or visit your lender’s website. Inform your second mortgage lender that you want to refinance your loan. Give your lender permission to review your loan and credit history.
3 Consult other lenders to inquire about second mortgage loans. Review their information about second mortgage product offerings. You may qualify for a home equity loan or a home equity line of credit. Complete the requested information to compare rates.
4 Choose the lender that provides the best terms for refinancing your second mortgage. Forward your loan documents to the mortgage specialist that will help you complete your refinance.
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