If you are looking to access some money but you are unsure of how to do it, a second mortgage could be exactly what you’re looking for. This can be a great way to tap into the equity that is locked in your home so that you can look to invest this elsewhere and make even more money over time. If you are interested in learning about the many other uses for a second mortgage then read on to learn more…
1. Investment
To make money, you need money. Taking out a second mortgage could help enhance your investment portfolio. You could even apply the money to an RRSP, which would allow you to get a nice tax refund.
2. Buying a second property
Another popular reason for a second mortgage is to fund the down payment for an income or vacation property. Traditional banks usually require 20% down for the purchase of a second property. This can often be too large of a sum of money to simply save for. A second mortgage can be a great and easy way to do this. This is a great way to use the equity that would otherwise be locked in your home. As you are able to buy a new property with these funds you will be continuing to build equity on two properties.
Buying property is one of the best ways to ensure long-term financial security. Once you have built up some equity in your second property then there is nothing stopping you from pulling the money from that home and investing it in a third, or fourth property.
3. Renovating your home
Renovations to your home can add a great deal of value to it. The only problem is that these renovations can be quite expensive as you need the funds up front to do the work. A second mortgage can allow you to tap into your equity and allow you to use that to do the much-needed work on your home. If you do decide to do this make sure that your renovations will add value to your home. It might be worth speaking to a realtor to see if the expense is really worth the reward.
4. For education
If you have reached a point in your career where you can’t seem to get ahead, then it might be time to look into some additional schooling. This can be very expensive though so tapping into the value of your home using a second mortgage can be a great solution. It doesn’t even have to be your own education that you are paying for. This can be for your children’s education too.
The cost of higher education can often be prohibitive without some source of funding. Being able to provide this for your children can be a wonderful feeling. If you are interested in a second mortgage, you should speak with a mortgage expert today.
5. To consolidate your debt
Paying off high-interest debt can be a real nightmare. It may seem like you are paying as much as you can each month and hardly making a dent. This can be very demoralizing and lead to some real frustration and stress. Credit card interest can be as high as 30%. By using the funds that you are able to get from a second mortgage you will be able to pay off all of this debt. This will dramatically reduce the amount of interest that you have to pay each month and allow you the peace of mind that comes with financial security.
