How to Refinance Second Mortgage Loans

If you have a second mortgage and want to refinance into into a new mortgage with a lower interest rate and better terms. BD Nationwide will assist you in your quest to shop lenders offering refinance loans, 2nd mortgage refinancing and fixed rate HELOC conversions for cash out or consolidation with fixed payment financing.

Can You Refinance a Second Mortgage?

You can a refinance a second mortgage into a fixed rate home equity loan, revolving home equity lines or refinance it into a new first mortgage. Refinancing a second mortgage, such as an equity loan or HELOC, is a popular method to secure a lower interest rate. Replacing one second mortgage with another is relatively simple, but it can become more complicated if you’re refinancing both your first and second mortgages together. This article will outline the steps for refinancing second mortgage loas so that you can achieve a better rate, lower monthly payment and possibly more cash out.

Refinance and select a fixed rate 2nd mortgage, variable equity line of credit or a 30-year fixed rate 1st mortgage. Don’t let the refinance era of low interest rate mortgages pass you by! You still have time to lock in a great rate on a home equity loan refinance that potentially saves you hundreds or thousands of dollars.

You can finally access the cash to help make your financial dreams a reality! Also consider a refinance second mortgage loan and enjoy the lower monthly payments and reduced interest rate.

Compare Lenders to Refinance 2nd Mortgage Loans and Home Equity Credit Lines

Getting a mortgage refinance loan offers you the opportunity to turn your variable rate credit line into a fixed rate equity loan with fixed mortgage terms. This can save you thousands of dollars a year in interest when you refinance and get cash out with a FHA mortgage that allows you to borrow up to 95% loan to value.

How Much Do You Want to Borrow?


See Lenders for Terms and Conditions

Interest rates could rise any day, so there’s no time to waste! 2024 is a great year to refinance a second mortgage so you can consolidate all of those high-interest credit cards that never seem to end. You can even make home improvements that could add value and beauty to your home!
  • Refinance and Lock into a Fixed Rate Mortgage
  • Fixed Rate Second Mortgage Refinance
  • Loans for Bill Consolidation and Lower Payments
  • Pay off Variable Rate HELOC with Fixed Interest Rates
  • Low Interest Rate Mortgage Refinance
  • Sub-Prime 2nd Mortgage Refinancing
  • Cash Out with FHA Mortgage Refinances
  • Non Conforming Mortgages

Refinancing a second mortgage presents more challenges compared to a standard refinance due to the increased risk borne by the lender. In the event you decide to sell your home or are unable to make the payments leading to a foreclosure, the 2nd lender receives proceeds only after settling the first mortgage. Consequently, the market to refinance a second mortgage is narrower, resulting in fewer alternatives for borrowers.

Nonetheless, individuals with solid credit, stable income, and consistent payment records typically have access to refinance options for a second mortgage or equity line of credit. It’s advisable to shop around and compare interest rates, including consulting with the current lender who might extend refinancing offers. While sticking with the current lender could entail savings on fees and select closing costs, it’s essential to weigh all available options as the best interest rate might not necessarily come from the existing lending company or bank.

Consolidate Your Debt and Save Money with Lower Monthly Payments from a Fixed Rate Second Mortgage

A second mortgage refinance could be the home financing solution to ease those financial anxieties. Take a breath, and call Nationwide to talk with an experienced loan professional about refinancing or restructuring your 1st and 2nd mortgage with a loan modification today.
* This is a sample of refinanced credit debt to and assumes interest rate for the second mortgage at 9.5%.
Apply Now and find out how much you can save!
  • 100% Refinancing – for Fixed Rate 1st Mortgage Loans
  • Interest Only Payments with HELOCs
  • Consolidate Debt with 1st Mortgages
  • Refinance Adjustable Rate Loans with Fixed Rate
  • Low Rate Home Mortgage Refinance to 100% LTV
  • Sub-Prime Home Equity Refinancing
  • Private Money Refinancing a 2nd Mortgage
  • No- PMI (Private Mortgage Insurance)
  • Save Money with Fixed Rate Home Equity Loans
  • Refinance Your ARM Now!

Should I Get a Refinance Loan With a Fixed or Adjustable Rate?

Home equity can be converted into money through one of several different instruments. If you have an adjustable rate home-equity line of credit, that is rising, we suggest refinancing into into a fixed rate first or second mortgage. The chore is to find out which one loan is right for your situation.

Refinance Your Second Mortgage Behind the ARM Home Loan

Nationwide unveiled a second mortgage loan that has the capability to subordinate up to 100% behind a negative amortization first mortgage. This innovative home equity feature provides an opportunity for numerous homeowners who have encountered challenges in securing a second mortgage or home equity loan that aligns with a first mortgage featuring negative amortization.

Refinance or Second Mortgage?

Combining first and second mortgages into one loan can be challenging, but sometimes it makes sense financially as well as being practical. In my borrower’s case, the best option was to leave his first mortgage alone, and simply refinance his 125% home equity loan with a 95 or 100% second mortgage to lower his monthly payments.
If you have reached the limit with your revolving equity line of credit it’s time for a refinance. Verify with your loan officer that your rate is locked with a fixed rate refinance. Fixing the rate with a fixed term will keep your monthly payment steady for the duration of the loan.

Is it possible to Refinance my 1st Mortgage only without Refinancing the Second Mortgage?

2nd mortgage refinance
Yes, it is possible to leave the 2nd mortgage alone and just refinance the existing first mortgage.
The only catch is that the second mortgage lender must approve a subordination agreement.
Unfortunately many lenders in second position drag their feet when it comes to subordination agreements.
Even if they do allow the second loan to be subordinated, they will require you to meet a certain criteria, like loan to value, and mortgage payment history.
Think about it, why would a lender who could potentially be elevated to first position want to subordinate? Mortgage companies are not required to subordinate loans, so if you want to subordinate an existing second, be prepared for a fight and follow the lender’s process for subordination approval.

Is refinancing the same as a second mortgage?

With a refinance, you receive your cashed-out equity as a lump sum. In contrast, with a second mortgage, you have the option to receive your funds as a lump sum equity loan or as a revolving HELOC line of credit, which allows you to borrow and repay as needed. Additionally, you may incur fewer closing costs.

Learn more about Second Mortgage Refinancing

Second Mortgage Refinance: This is the process of revising your existing second mortgage, usually with the aim of saving money by reducing the interest rate or accessing additional cash. Many individuals opt for this loan to convert their current variable rate mortgage into a fixed-rate second mortgage with a consistent monthly payment, potentially saving thousands of dollars over the loan term.

The Combined Loan To Value: (CLTV) is a crucial metric that assesses the total balances of the loans secured to the home in relation to the appraised value. To calculate CLTV, add up the balances of the 1st and 2nd mortgages, then divide the sum by the appraised value of the home. For instance, if the first mortgage is $150,000 and the proposed second mortgage is $45,000, the combined total is $195,000. With a home appraised at $200,000, the Combined Loan to Value is 97.5%.

Interest-Only Mortgage: These loans enable borrowers to make reduced monthly payments, covering only the interest portion. No part of the interest-only payment contributes to paying off the principal unless additional funds are added. Interest-only periods typically last for the first 10 years or the draw period for most loan programs. The interest-only mortgage gained popularity with rising property values, making minimum mortgage payments more affordable for homes that might otherwise be too expensive.

Debt-to-Income Ratio (DTI): DTI is determined by dividing your total monthly payments (mortgage, credit cards, loans, etc.) by your gross monthly income before taxes. It is a critical factor considered during the loan underwriting process for approval.

Takeaway on Refinancing a Second Mortgage

Refinancing a second mortgage usually involves higher interest rates and a more stringent approval process from the lender. Additionally, you could be required to pay lending fees and closing costs when 2nd mortgage refinancing. However, it is generally easier and quicker to refinance a second mortgage compared to a primary mortgage.
BD Nationwide wants to make your mortgage refinance experience online a positive one that benefits your finances. Our experienced staff can help you shop lenders and brokers in a quest to find the lowest possible rate for refinancing a second mortgage that factors your payment into your budget.