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A Soft Second Mortgage Offers Home Buyers More Options

There has never been a better time to buy a home. With many different options, there are very few individuals that can’t find funding. If your credit is in good standing, you may be able to secure a soft second mortgage when you purchase your home. It is important to discuss all of your options with your lender, and make sure that you qualify.

What is a soft second mortgage? Basically, it is a system designed for first time home buyers that may have trouble coming up with a large down payment. The buyer will take out two different loans. The first will be for 75% of the purchase price. Then a soft second mortgage will be taken out for a maximum of 20% of the purchase price. So essentially a homebuyer can purchase a home will as little as 5% down. Soft second mortgages may also include lower interest rates and reduced closing costs.

There are many reasons why you should take out a soft second mortgage. By saving a significant amount on closing costs, you can often get into your home years before you normally would. There are also many costs that are associated with a new home such as paint, moving trucks, and minor repairs and you will have more money to pay for such last minute items if you take out a soft second mortgage. Consult with your home equity loan company, and ask them if they offer this type of mortgage.

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