Second Mortgages in Vancouver

Getting a second mortgage in vancouver.

A Second Mortgage in Vancouver

When buying a home there is a whole lot more that goes into it than choosing a home and buying it. There’s a lot of legal jargon, different terms, definitions, and standards when it comes to home buying and mortgage loans. Even for experienced home buyers, understanding all the facets of mortgages can be challenging. In certain circumstances, you may have to think about getting a second mortgage. This is a mortgage typically taken out by homeowners who need extra cash for anything from emergency repairs, working capital for businesses or investments, renovations, funding education, paying for a wedding, or even to consolidate other debts or lines of credit.


An Overview

A second mortgage can mean two things, a mortgage you take out on a second home; some refer literally to a second mortgage, and some refer to a mortgage which sits on top of a primary mortgage. The latter is the more used, and more accurate use of the term second mortgage, and what we will talk about here.
Second mortgages extract equity from a home, which allows homeowners to access capital when they need it. The basic form of second mortgage comes in the form of a lump sum load. With a standard equity loan, you can borrow up to 85% of the value of your home in major cities in B.C., Alberta, and Ontario. For most other cities in Canada, the max is typically 80 percent.

How Does It Work?

Second mortgages are typically held by a different lender than the one who lent the primary mortgage. The distinction between primary and secondary mortgages is an important factor to keep in mind. Rather than simply increasing the principal of your initial mortgage loan, second mortgages have their own terms, rates, and rules. This means that you pay it off independently of your primary mortgage. When you get a second mortgage, you will continue to pay your primary mortgage along with the additional mortgage.

Before You Apply

Before you can apply for a second mortgage, you will need to find out how much equity you have in your home, the value of your home, and your credit score. All of these details will affect your ability to secure a second mortgage, and they also influence mortgage rates and terms. It is best to shop around with various banks and lenders. It is important to partner with a knowledgeable mortgage professional who will tailor a loan product to your specific needs.


In many ways, applying for a second mortgage is similar to applying for a primary mortgage. A major difference, however, is that the second mortgage rates are typically higher than those associated with primary mortgages. This is because lenders that offer second mortgages typically have to assume more risk of delinquent payments or loan defaults. Second mortgages can range greatly, but a borrower with good equity and credit history could get a 6.99% or 7.99% rate. While this may seem high, it is low when compared to most unsecured credit lines and credit cards.

In Conclusion

Crown Funding in Vancouver is an expert in second mortgages. We can get you the best rates possible for your situation. Check out the website here.