Over the years, homeowners have used the equity in their homes to secure financing. One popular way to tap into home equity is through a second mortgage. But before applying for this type of mortgage, it's crucial to understand what it is, how it works, and its pros and cons.
Before we look at the many ways you can spend your home equity mortgage loan, let us first discuss the main types available in the market. Ideally, each type has pros and cons, and you need to understand your needs before picking one.
Compared to unsecured loans such as credit cards, signatures, and payday loans, home equity loans are more flexible and incur lower interest rates. We have discussed what home equity lending is and what to consider before obtaining one.