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10-11-2011, 12:41 AM #1Registered User
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What is the difference between a HELOC and a 2nd mortgage?
Ok not sure where to put this, mods feel free to move!
Basically I was sitting here and that question popped into my head. What is the the difference between the two?
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10-11-2011, 01:59 AM #2Registered User
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I believe a heloc is basically a reusable credit account that you can borrow against, pay off, do it again. A 2nd mortgage is just a lump sum.
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10-11-2011, 08:20 AM #3Rude and Vile Master
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Basically yes. HELOC is an amalgam of "Home Equity" and "Line of Credit". A LoC is exactly what Nishu described - you can draw on the credit as long as you have credit available.
Originally Posted by Nishu
The Home Equity part comes in because the LoC is tied to your home.
"2nd Mortgage" just means "a mortgage (of any type)" tied to your home in 2nd place after the primary mortgage. Strictly speaking you can have 3rd and even 19th mortgages, if your lender allows it.If you could kick in the pants the person responsible for your problems, you wouldn't be able to sit for a month.
Did you know that a 4 year student paying $20,000/year who finances their education graduates with over $103,000 in debt to start? But a student who works and pays cash and takes 6 years to graduate ends with $6,300 in their pocket! So much for "getting a head start by financing!"
Greebo(Nerd Spender): Loving and extremely patiently tolerated husband of ceashels.
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