June 1, 2020 nkad3

Second Mortgage Process

Second mortgages are a very common request, especially in markets with growing home appreciation and increasing household debt. Reasons for needing this type of mortgage are endless and if used correctly, they can help achieve many different goals which can be outlined in some of our previous blogs. Among questions surrounding the specifics of the mortgage itself (rates, terms, standard conditions, etc.), we’re frequently asked what the ‘second mortgage process’ is like, as applicants tend to worry as to whether they’ll qualify given their recent denial from their home branch. This blog is catered to the second mortgage process more so than the typical terms and conditions of the mortgage.

The second mortgage process is (or can be) a quick and painless one. Unlike your traditional forms of financing (i.e. banks or alternative-A lenders), second mortgage lenders often require only basic documents to get started and can be funded (money in hand) in as little as 48 hours for rushed deals, or 4-5 business days at a much more relaxed pace.

If we break the second mortgage process into 4 identifiable steps, it will resemble the standard mortgage process that you’re likely already familiar with but would happen much quicker and with far less requests. The second mortgage process could be outlined as such:

  1. Initial Consultation (15 – 20 minutes phone call):

Discuss with your mortgage broker your request (loan size), short and long terms goals for the use of the second mortgage and other important details pertaining to your existing first mortgage/finances

  1. Provide Basic Documentation (15 – 30 minutes):

Provide basic documents via email such as – mortgage application, mortgage statement, property tax bill and valid home insurance policy. Sometimes, but less frequent, additional documents might be needed.

  1. Meeting with us, your broker! (30 minutes in person meeting):

This usually can take place within 24 hours of providing the application. The convenient part is, we can come to you! This is where we discuss all details of your second mortgage financing and is the most important part of the second mortgage process.

  1. Sign with the Lawyer (30-minutes in person meeting)

Since this is a mortgage, it must be legally registered to the property as such. Prior to receiving the funds, you’ll need to meet with the lawyer to sign the second mortgage closing package.

We understand that at first glance, this might seem like an overly simplified second mortgage process, but the truth is, it’s very simple. With the right guidance, resources and strategy, the second mortgage process is far less complex than that of traditional financing. In step 1, 3, 4, you’ll be given the opportunity to learn about the specific details of the second mortgage itself, thus being able to make informed decisions (Mortgage rate, term, payments, terms, etc.)  and will be prepared for each following step.


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