80 Percent Mortgage
As the residential financing and homeownership market
swells with mortgage holders, a second mortgage or an 80
percent mortgage has become an advantageous tool for helping
persons mitigate through times of financial need.
Devised of two components: the interest rate and the principal,
mortgages may only be seen as a financial obligation. Yet,
over time, mortgages can also be seen as a source of accessible
capital and credit.
This is attributed to the fact that during the early stages
of repayment of a loan, the borrower is essentially repaying
the interest. However, as the mortgage is paid off, the
equity of the property begins to appreciably expand.
With the vast number of lending products and mortgage
companies that abound on today’s market, there is
no shortage of supply. And where 80 percent second mortgages
are concerned, the supply is equally as great. Not only
do the top ranking lending companies have a wealth of 80
percent mortgage products, but they are also stocking up
on additional, newer varieties.
Called second mortgages, eighty percent second mortgages
or home equity loans qualify under this heading for they
actually become the secondary holder of the home property.
In other words, if the borrower defaults on the loan, the
second mortgage company cannot collect on the lien until
the first lending institution has been satisfied.
The benefit of a second mortgage or 80 percent mortgage
is that the interest rate is normally very affordable. The
second mortgage is generally financed based on the property
value of the home, as well as, how much the original mortgage
holder has paid in the way of equity (repayment of the principal
aspect of the mortgage.
While the homeowner’s purpose in securing an 80
percent second mortgage can run the gamut from desiring
to pay back logged bills, he | she may also want it to make
home repairs and | or improvements. Often homeowners would
like to make property enhancements without using their savings,
trust funds or retirement money so they opt to take out
a home improvement loan or an 80 percent second mortgage.
Today's lenders continue to provide excellent loan terms
at reasonable interest rates. In fact, there hasn't been
a better time in several years to consider taking advantage
of current home improvement loans available on the market.
As an equity loan is typically eighty percent of the property's
value, most homeowners do not need even need the entire
amount in order to cover the cost of their proposed housing