A second mortgage essentially refers to a loan obtained against an already obligated property, and if the borrower defaults on his or her ongoing mortgage, the first loan is repaid before the second. Admittedly, the rate of interest of a second mortgage is comparatively higher, and depending on how much loan is required, the sum of money that you are allowed to borrow may be more or less when compared to the amount approved for your first mortgage.

However, taking a second mortgage may be the wisest choice when you need a lot of liquidity but do not have adequate financial means to ensure the same. Similarly, being subordinate to both your first and second loans, a third mortgage must not be paid off until the other loans are. You can renovate your house, pay college tuition for children, upgrade your lifestyle, and more with a third mortgage.

At Royal King Mortgages, we do not provide second and third loans solely based on your income ratio, work history, or credit score. Employing a holistic approach to assess every potential application, the most critical factors that we particularly seek before sanctioning a second or third mortgage include whether the applicant owns any property or not and if his or her house has accumulated enough equity over time.

If your credit score has decreased considerably since you have taken the first or second mortgage, a remortgage is going to put even more stress on your finances, and this is why obtaining a new loan against an already obligated property is always preferred over the latter alternative. Note that you will incur interest only on the additional sum of money borrowed in case of the former option, whilst the interest will be computed on your entire loan amount with a remortgage.

Do not hesitate to reach out to one of our consultants for any queries or further information on how you may benefit by obtaining a second or third mortgage from us!