2nd Mortgages
Borrow: $20,000 to $1,000,000
Loan Terms: 12 months
A second mortgage is a perfect solution if you need a loan advance for about 12 months. 2nd mortgages are almost always for some kind of business purpose, and are secured against a piece of real estate. Repayments are generally Interest Only for the loan term. In many cases, the loan can be rolled over for another 12 months after the initial term has expired.
You need to have equity in your house and have the ability to make the interest payments, before you can apply for a second mortgage. Having equity means that your home is worth more than the amount you owe on it.
A second mortgage is quite simply a loan taken after the first mortgage. There can be various reasons to take out a second mortgage, such as consolidating debts, a cash injection for your business, a deposit on another property. Basically they can be used for any worthwhile business purpose.
In obtaining a second mortgage, we need to closely evaluate your financial situation to determine whether to approve the loan. There are certain things that welook for.. Here are the basics of what we look for in a second mortgage loan application.
Equity
One of the first things that a lender is going to look for is equity in a piece of real estate. We can lend up to 75% Loan to Valuation Ration (LVR) on residential properties and 70%LVR on commercial properties.
Loan Purpose
In most cases, 2nd mortgages need to be for some kind of business purpose.
Your Ability to Service the Interest
Interest is paid monthly, so some kind of cashflow will be required by the borrower in order to service the loan.
Valuation
With 2nd mortgages, a sworn valuation is required in most cases. This is arranged by us and usually takes 2 or 3 days to be done.
How Quick Can They Settle?
Compared to a short term Caveat Loan which settles in 24 hours, a 12 month second mortgage is a lot cheaper however it can take between 2 to 3 weeks to settle. They are a much more affordable option if you require funds for a 12 month period and have a few weeks before you need the funds.