What is second mortgage?Written by Ajay Pats
What is a second mortgage?
A second mortgage is a loan that is secured by home itself, and subordinate to first mortgage. Any mortgage taken out against a home in addition to an already established mortgage automatically becomes a second mortgage.
As name implies, second mortgages are secondary to first mortgages. This means if homeowner is forced into foreclosure, second mortgage holder will receive no proceeds from sale of home until first mortgage has been completely repaid.
Characteristics of a typical second mortgage: Since lender's risk is higher, second mortgage loans carry a higher interest rate than first mortgage loans. Second mortgages are typically shorter in duration (usually 15 years or less). A second mortgage may require a "balloon" payment at end of repayment period. This one is a biggie: interest paid on a second mortgage is tax deductible in most circumstances!
Primary types of second mortgages:
Home equity loan - This is traditional type of second mortgage. There is a one-time disbursement of loan funds (in a single check) followed by a period of regular monthly payments and a fixed interest rate.
Home equity loans are often used to consolidate debts, remodel home, fund a college education, purchase a big ticket item such as an RV, or most anything that requires a large amount of cash. Line of credit - This type of second mortgage is very different from a home equity loan. With a line of credit, you don't receive a large check for full amount up front. You may never even borrow any actual money from it at all!
The interest and payment on a line of credit second mortgage can and does change periodically. The interest is typically tied to prime rate. The actual interest rate will be prime rate + a certain number of percentage points.
(New construction windows or replacement windows? Which is right for you?)Written by John Rocco
(New construction windows or replacement windows? Which is right for you?)
Hello, my name is John Rocco.I grew up around window and door business. My father owned a glass shop that dealt in every aspect of residential and commercial glass.Naturally, when it came time to choose a profession, i wound up in window and door business. I have been in business for about 27 years, and i have been self employed for 20.One of things that seperated my company from my competitors was my willingness to show my customers how to replace their windows themselves. Whenever i would encounter a customer with a curiosity or willingness to learn how to install their own windows,i would offer to sell them labor on one window,using them as my helper.Then,they would install rest of windows using knowledge gained from helping me install one.Most window companies would never do this because there is so much money made on labor.But i was always so busy,i never felt like it was costing me money.Eventually, i made an installation video for those homeowners who wanted to do their own windows.While video is for sale on my website, i decided to take excerpts from video and write an article once a week covering some part of window replacement project.This article is going to cover difference between window frames used in new construction homes, and window frames that are used to replace existing aluminum or wood windows.
When a new home is being built,the windows are nailed to wood studs that make up house frame.In order to accomplish this, new construction windows have a fin around all four sides of frame that rests against outside of stud, and nails are driven into studs through nailing fin. After that,flashing paper is applied to prevent water leaks, then exterior, material is applied. That material can be stucco, brick, siding, etc.Now, imagine 10 or 20 years later when you want to replace those