How to Get 2nd Mortgages With Bad Credit

Upon financing your home, you created a loan referred to as a mortgage. As the value of your home increases, you gain equity in the home. Equity is the difference in the amount of money you owe on the mortgage and the amount of money the house is worth. When people want to borrow money using the equity in the home and using the home as collateral, they can take out a 2nd mortgage loan. Even if the homeowner has bad credit, it can still be possible to be approved for a 2nd mortgage.

Instructions

1

Visit zillow.com and enter your home street address including city, state and zip code. Zillow will provide you with a value of your home based on the information the site has on your property as well as sales in your area. While this value will not be exact for your home, it will provide a general estimate of the current value of your home.

2

Compare the value of the home listed on Zillow to the amount of money you owe on your mortgage. Subtract the amount you owe on the home from the value of the home listed on Zillow. This amount is a rough idea of your equity.

3

Contact your lender. You can find their customer service number on your monthly mortgage statement. Tell them you are looking to take out a 2nd mortgage and be upfront with them about your credit situation. If the lender feels you may qualify for a 2nd mortgage, he will require an appraisal to determine the exact value of the home. The higher the equity in the home, the better chance of obtaining a loan as the lender knows he can recover any money you do not pay by gaining possession of the home.