The Immense Benefits of Second Mortgages in Canada

With a second mortgage, you have the ability to take a loan against the value of your home. Your home becomes an asset over time, and it grows in value, thus giving you the leverage you need to access more funding. If you feel baffled by all the hullabaloos about second mortgages in Canada, here are some of the benefits regarding why some people can’t stop talking about them:

They give you access to significant loan amounts

Since the loan is secure against your current home, which is worth a lot of money, second mortgages can let you borrow a significant amount of money. You will essentially have access to more money than you could if you were not using your home as the collateral. Depending on the lender, you can borrow up to 80% of your home’s total worth.

Lower interest rates

The other admirable advantages of second mortgages in Canada, is that they are available at very low interest rates. This is simply because the loan is secured against your home, and so the risks to the lender are greatly minimized. Unlike other unsecured loans like credit cards, the interest rates on second mortgages are usually within the range of single digits.

Tax benefits

In some instances, you may get tax deductions for all the interest accrued on second mortgages. Though this comes with a lot of technicalities, and for which you ought to confer with a tax expert, second mortgages will always come with certain tax relief that every homeowner would enjoy having.

Flexibility on the use of the money

When you go for a second mortgage, you aren’t restricted on what you can do with the money. This is unlike the case with the first mortgage, which you must just use in acquiring a home. With a second mortgage, however, you are at liberty to use the money as you please. Get another home, go for a vacation, increase the cash flow in your business, start a new business or just use it to enjoy the good life.