What type of lien is a second mortgage?
What type of lien is a second mortgage?
A second mortgage or junior-lien is a loan you take out using your house as collateral while you still have another loan secured by your house. Home equity loans and home equity lines of credit (HELOCs) are common examples of second mortgages.
Why do I need a second lien mortgage?
A few reasons why a second lien loan may exists are: to avoid Jumbo financing by keeping the first lien a Conforming Loan ($417,000 or less) to act as a Bridge Loan for a purchase (i.e. get the second loan with the intention of paying it off once your current home sells after the new purchase).
Where does the lien go on a mortgage?
The mortgage on the other hand provides the lender or mortgage company a lien on the home. The lender or mortgage company then records the mortgage in with the county recorder’s office or county clerk. This is referred to as the “first mortgage” or “first DOT (deed of trust).”
How long does it take to clear a second mortgage lien?
Check payoffs take up to two weeks to clear. If you have a fixed rate term loan, the lender sends the satisfaction of lien directly to the county court when the funds are received.
What do you call a 30 year second lien loan?
If you are getting a second lien that is amortized over 30 years, chances are that the loan has a balloon payment feature. This loan type is typically referred to as a “30 due 15” or “30/15” because it’s really a 15 year loan that is amortized over 30 years.
A few reasons why a second lien loan may exists are: to avoid Jumbo financing by keeping the first lien a Conforming Loan ($417,000 or less) to act as a Bridge Loan for a purchase (i.e. get the second loan with the intention of paying it off once your current home sells after the new purchase).
Can a second mortgage be used to purchase a home?
A loan to purchase a home is usually the first mortgage lien recorded on a property; subsequent loans depend on the amount of owners’ equity in the home and generally require a new appraisal. Homeowners may use the money from these second mortgages – available as a lump sum home equity loan or as a home equity line of credit – for any purpose.
What happens to a second mortgage after a foreclosure?
Following a first-mortgage foreclosure, all junior liens (including a second mortgage and any junior judgment liens) are extinguished and the liens are removed from the property title. But the second-mortgage debt and creditor’s judgment remain, even though they’re no longer attached to the foreclosed property.
What happens when a lien is attached to a title?
A home’s chain of title details its ownership history as well as any liens attached to its title. A property lien serves as public notice that the property’s owner owes a debt to the creditor holding the lien. A lien attached to a property’s title can prevent its sale, and the property’s owner may have to file a legal action to have it removed.