Purposes

• A second mortgage can provide cash for a variety of purposes. Popular reasons for getting a second mortgage include paying off debt, remodeling your home or starting a business.
  
  

Home Equity

• Getting a second mortgage largely depends on your home equity. Each lender will have its own guidelines about the loan-to-value ratio to use, but it's usually between 75 and 85 percent.
  
  

Home Value

• Current home value is considered when determining eligibility for a second mortgage. Home values can change, which can affect how much home equity you have.
  
  

Mortgage Approval

• Getting a second mortgage ( home equity loan) is not as complex as qualifying for a primary mortgage, but loan terms can vary depending on your credit score and amount of home equity.
  
  

Foreclosure

• If your primary mortgage goes into foreclosure, your second mortgage lender has the right to advance funds to the first mortgage lender. A second mortgage holder can foreclose based on failure to pay either your first or second mortgage.