Collateral Mortgage - Should you CONSIDER it?

By: Gemma Leggett

Collateral Mortgage - Should you CONSIDER it?

Tags: Collateral Mortgage, Mortgage Newmarket, Newmarket Real Estate, Newmarket Realtor, Aurora Realtor, Aurora Real Estate

Have you ever heard of Collateral Mortgages?

A collateral mortgage is a type of mortgage that will give you more funds than a conventional mortgage. It allows you to secure a mortgage against your property. It's like a Home Equity Line of Credit (HELOC), you can borrow more money, without having to refinance. 

When applying for a mortgage, we’re familiar with asking about the term, amortization, interest rate, and monthly payments. There’s another aspect to be aware of. Some Mortgage Lenders are now asking Borrowers to sign Collateral Mortgages — and it could result in a Borrower being tied to that Lender for longer than anticipated.

The downsides of a Collateral Mortgage can be summed-up as:

Like everything, before jumping on anything, be sure to do your research and to read the fine prints, so you can make an informed decision. 
If you need any help, let me know, I work with a lot of great lenders that can help you find the best product for your needs.