Expert Insights: What Is a Second Mortgage?
It is a loan against the equity in your home. Financial institutions will generally let you borrow up to 80% of the appraised value of your home, minus the balance of your original mortgage.
You may incur all the fees normally associated with a mortgage, including closing costs, title insurance, and processing fees.
Home improvement loans are often written as second mortgages. And sometimes you can get a college tuition loan by using a second mortgage. In case of default, the loan is paid off from the proceeds of the sale of the property, after the first mortgage has been paid off first.