A private mortgage is one that is financed by an individual or private corporation. Private mortgages can be first, second and third mortgages.
A second mortgage or a home equity loan is an additional loan that is taken on a property that is already mortgaged. In many instances, homeowners do not use the same provider as their first mortgage for second mortgage requests.
There is virtually no difference other than a first position mortgage taking priority over the second mortgage. While you must continue to pay both mortgages as per signed repayment schedules, if your house was to be foreclosed or sold, the solicitor would ensure that the first positioned mortgage is paid in full before paying off the second position mortgage.
Each homeowner will have a different amount of equity. Home equity is the value of an asset less all liabilities associated with that asset.
For example, if your home is worth $500,000 and you have a current mortgage of $200,000 outstanding; your home would have $300,000 in equity. Equity Lending is when a lender provides funds to a borrower strictly based on the subject home’s equity.
