Three Steps to Saving Money on Second Mortgage

A mortgage, whether a first mortgage for a home purchase or a second mortgage for debt consolidation is a financial product in a competitive market. There are over 19,000 mortgage lenders in the U.S., and there can be variations among them when it comes to fees, rates, and terms.

When shopping for a second mortgage, here are three steps that could save you thousands of dollars over the life of the loan.

• Compare information - Obtain information from several lenders. Second mortgages are available from a variety of financial institutions: commercial banks, mortgage companies and credit unions. Since rates and points can change daily, you will want to check the Internet or your local newspaper often when shopping for a second mortgage.
• Negotiate the best deal - Have lenders write down all the costs associated with the second mortgage, then ask if he or she will waive or reduce one or more of the fees, or agree to a lower rate to secure your business. There is no harm in asking. Once you are happy with the terms, ask for a written “lock-in” from the lender.
• Know your rights - The Equal Credit Opportunity Act prohibits lenders from discriminating on the basis of race, color, religion, national origin, sex, marital status, age, whether all or part of the applicant’s income comes from a public assistance program, or whether the applicant has in good faith exercised a right under the Consumer Credit Protection Act.

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