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Is a Second Mortgage a Good Idea?

If you need money for home improvements, tuition or another purpose, you might be able to secure funds through a second mortgage.

How Does a Second Mortgage Work?

A second mortgage is a loan that allows a homeowner to borrow against the value of their house by using it as collateral.

One option is to receive a lump sum of money to be repaid over a period of time. Another is to open a home equity line of credit.

Before getting a second mortgage, be sure to weigh the decision carefully.

Falling behind on your payments could put you at risk of foreclosure.

A second mortgage should only be used for a legitimate purpose that will benefit you in the long run.