2nd Mortgage: 12 Answers to the Questions You Should Be Asking
The 2nd mortgage is a complex, but very useful, real estate tool. The 2nd mortgage is a useful tool that can greatly extend the financial options of a person with equity in a piece of real estate. However, the responsibilities of this kind of a loan are equally as large. You must understand the risks and the advantages of the 2nd mortgage fully before committing yourself to it. Here are some answers to top questions that you should be asking.
Points, APRs, and Other Homebuyer Fees
WHAT ARE POINTS? Points are fees your lender charges, usually 1 or 2 percent of the total loan amount. It's important to factor in points when shopping for mortgages as a loan with a higher interest rate and no points could ultimately be cheaper than a lower interest rate with points. It’s also possible to negotiate that the seller pays points.