Second Mortgage

Second Mortgage
A type of subordinate mortgage made while an original mortgage is still in effect. In the event of default, the original mortgage would receive all proceeds from the liquidation of the property until it is all paid off. Since the second mortgage would receive repayments only when the first mortgage has been paid off, the interest rate charged for the second mortgage tends to be higher and the amount borrowed will be lower than for the first mortgage.

Since the first mortgage is used as a loan for buying the property, many people use second mortgages as loans for large expenditures that may be very difficult to finance. For example, people may take on a second mortgage to fund a child's college education, or to purchase a new vehicle. Second mortgages also can be a method to consolidate debt by using the money from the second mortgage to pay off other sources of outstanding debt, which may have carried even higher interest rates.


Investment dictionary. . 2012.

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Look at other dictionaries:

  • second mortgage — see mortgage Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. second mortgage n …   Law dictionary

  • second mortgage — ➔ mortgage1 * * * second mortgage UK US noun [C] (also remortgage, also US home equity loan) FINANCE, PROPERTY ► a loan that someone gets using their property as security (= an asset that the lender can take if the loan is not paid back), when… …   Financial and business terms

  • second mortgage — n. an additional mortgage placed on property already mortgaged: it ranks below the first mortgage in priority of claim …   English World dictionary

  • Second mortgage — A second mortgage typically refers to a secured loan (or mortgage) that is subordinate to another loan against the same property. In real estate, a property can have multiple loans or liens against it. The loan which is registered with county or… …   Wikipedia

  • second mortgage — A mortgage taken out on a property that is already mortgaged. Second and subsequent mortgages can often be used to raise money from a finance house (but not a commercial bank or building society) if the value of the property has increased… …   Big dictionary of business and management

  • second mortgage — additional mortgage, second loan gained by placing a property in mortgage …   English contemporary dictionary

  • second mortgage — A junior mortgage, a mortgage to which another mortgage is prior …   Ballentine's law dictionary

  • second mortgage — noun a mortgage that is subordinate to a first mortgage • Hypernyms: ↑mortgage …   Useful english dictionary

  • second mortgage — noun Date: 1912 a mortgage the lien of which is subordinate to that of a first mortgage …   New Collegiate Dictionary

  • second mortgage — a mortgage the lien of which is next in priority to a first mortgage. [1900 05] * * * …   Universalium

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