If your "first" mortgage has ballooned, you are probably wondering Can you get approved for a second mortgage to buy another house? If you have the time, go down to your local bank and ask if they are planning to let you borrow again. Often they will be willing to extend you an option to refinance with them as it is cheaper for them. You may even qualify for a low interest rate if you buy two homes with your first loan and secure another loan against the second property. However, some banks only do this with second mortgages. They don't do it with first home buyers.
Banks that offer second mortgage options do not necessarily give first time home buyers special financing on both loans. If they do, they may not qualify you for the best rate or offer you the lowest monthly payments. So is it possible to get approved for a second mortgage to buy another house? Of course it is. The first thing to do is to shop around for a bank that offers a second mortgage. Once you find one, talk to their financial adviser to find out if you qualify for this type of loan. Do your homework before talking to the adviser because there are several different types of financing available through a second mortgage. Some are much more attractive than others. Your interest rate is going to depend on a few factors. If you have great credit, you should get a high interest rate.
Your income is another factor. If you just came out of college, you might be able to get a low rate. But if you have been working for the past couple of years, you should expect to pay a slightly higher rate. How much do you currently pay for your auto insurance? Those things can affect how high your rate will be. After you talk to a few advisers and find out what is available through a loan, you will then need to start shopping around. Look at a few homes and see what each loan offers. Compare the interest rates. Talk to loan officers to see if you are able to get the specific kind of loan that you need. Some lenders only make certain loans available.
You will probably need a co-signer to sign for the loan if you are getting a mortgage from a bank. Otherwise you will not qualify. If your credit is excellent, you could have a great interest rate. If your credit is not so good, you will probably have to pay more in interest. If you have had bad credit in the past, there are some lenders who will still offer you a loan. But the terms will be a bit more strict. They will most likely call you back at least twice before approving you. This is due to the fact that they are still concerned about your credit history. But if you have great credit, you could be offered a competitive rate.
When you get ready to buy your second home, it will be wise to use your credit score as much as possible. You will need it for a mortgage. So make sure it is in tip-top shape when you apply for your next mortgage. You will be glad you did!
The best way to build your credit back up to a respectable level again is to get some credit cards and then use them responsibly. Use the card to pay off some of your smaller debts and then start using the card to pay off the larger ones. You should pay off the second mortgage in about six months. Then you will have the option of paying it off in full with another second mortgage.
The best way to build credit is to simply have a good payment history on your credit cards. Then you will build a record for yourself showing that you can handle credit payments. Once you do that you will have a better chance of being able to get your second mortgage approved. How long does it take for someone who has less than perfect credit to get approved for a mortgage? Sometimes it takes as little as three months to be able to get approved. If you are trying to refinance a second mortgage for an extended period of time you may have to wait a bit longer. As long as you do your homework and make all the payments on time you will be able to find a good rate. Remember to shop around and compare the different lenders to find the best deal possible. If you follow these tips you should be able to get a second mortgage with excellent credit.