Buying a house provides serious tax shelter advantages. Home ownership should be a priority of every personal financial plan.

So be sure you understand how soon the 2nd mortgage is to be repaid, the amount of monthly payments, if there is a balloon payment at the end of the term, and whether the interest rate is fixed or adjustable. 

This advice applies to any mortgage whether it for buying a house, refinancing, or obtaining a line of credit, or equity 2nd.

Although you can borrow against your home tax free that doesn't mean it is cost free.

Banks are in the business of making money as are all mortgage lenders. Whether you decide to refinance your 1st mortgage entirely, apply for a line of credit, or acquire a 2nd mortgage, you must be sure you understand completely what closing costs will be incurred, what is the period for the loan to be repaid, and what interest rate you will receive.

In addition you must know if the interest rate and payment can adjust and if so, how much and how often.

Pre payment penalties tomorrow,

Kate, your mortgage translator on a crusade helping homeowners reduce mortgage closing costs.

Regarding tax implications, it is always recommended that you consult a qualified financial adviser.

P.S. To read my article in full, visit Free Real Estate And Mortgage Articles