Second Mortgage / Home Equity vs. Refinance

Why should you take out a second mortgage or a home equity line of credit instead of refinancing?

Well,………You Shouldn’t!!

Why Not?

1. Second Mortgages usually have got an interest harangue that is twice or even three modern times as high as your first mortgage rate. You can refinance instead and maintain a very low rate. In the long tally a second mortgage will just cost you money in interest charges.
2. Home equity lines of credit are designed for mortgage account executive directors (salespeople) to sell you on using it like a credit card attached to your home. They will seek to convert you to utilize it over and over again.
3. A refinance loan is better for the equity in your home. Very few companies will refinance your home at 100% of it’s value without forcing you to take out a second mortgage. You don’t desire to utilize 100% of your equity because that agency you no longer have got that equity to fall back on in emergency situations.
4. Second Mortgages and Home Equity lines of credit are designed to supply account executive directors (salespeople) with another tool to rock you into putting another committee in their pocket.
5. Your equity is a cherished thing and should not be used for unneeded add ons or urge buys. If you don’t need it and there is even a flimsy opportunity you can’t afford it, then don’t get a second mortgage to purchase it.

The lone ground that I would ever urge a second mortgage or a home equity line of credit is in an emergency situation. Only when there is no other option and you must take out a loan would I urge either one of these options.