Second Mortgage Interest Rates

by Melodie
(Federal Way, WA King County)

Regarding second mortgage interest rates and fees: Kate, why are there so many fees on a 2nd mortgage loan? I don't understand why the interest rates are so much higher also. Can you help me

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Kate Answers: Second Mortgage Interest Rates

Dear Melodie, A second mortgage compared to a first mortgage is riskier for mortgage companies. That is because in the event of a foreclosure, the holder of the second mortgage has less chance of getting paid off than does a first mortgage investor.

This risk is passed on to the homeowner in the way of higher interest rates, more fees and even prepayment penalties.

However fees vary among lenders. Some of the big banks from time to time run specials on home equity loans. This of course depends on the state of our economy, appreciation or depreciation in the real estate market and the condition of the credit markets.

Closing costs also depend on the homeowner's credit file. The lower the credit score, the greater the fees. So if you are concerned with the second mortgage interest rates and fees you are being charged, talk with your loan representative.

And remember, you can ask your Realtor to review your good faith estimate or recommend another lender.

The following pages shed more light on mortgage fees. After reading through them, I hope you'll let me know if you have more questions.

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Compare mortgage closing costs - I'm going to simplify Good Faith Estimates right now and reveal little known secrets to becoming a savvy mortgage shopper.

Compare mortgages - Are you looking for a unique method to compare mortgages?

Don't miss checking this out on my real estate article site:
Understanding Mortgage Closing Costs - Let's learn to lasso mortgage closing costs once and for all.

Take a moment to bookmark Second Mortgage Interest Rates And Fees to your favorites and visit often for more tips about closing costs and good faith estimates. You can also invite friends to comment on this page or ask another question of their own like you did.

Best Wishes,

P.S. Go to my Best Mortgage Rate Blog an entertaining source of mortgage information. Subscribe now to the RSS feed.

FINALLY! The PMI Answers You Need

What Is PMI - Could private mortgage insurance be your solution to equity and down payment problems?

You might not know this but you could be entitled to a mortgage insurance refund from FHA.

How do lenders calculate PMI? Credit history, amount of down payment or equity, occupancy status, and loan type contribute to calculations.

How Do I Cancel PMI Will refinancing or a new appraisal be required?

What to do if PMI Decision Making is getting in the way of refinancing or buying a house.

Ask Kate About PMI - Ask a question about PMI and get an answer from Kate.

My name is Kate and I will be your guide - PMI Questions and Answers

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