Can you refinance a second mortgage?

With a refinance, you must accept your cashed-out equity as a lump sum. With a second mortgage, you can receive your funds as a lump sum (home equity loan) or as a revolving line of credit (HELOC) to borrow from and repay as needed. You may pay fewer closing costs.

What is the difference between a cash-out refinance and a second mortgage?

Cash-out refinances and second mortgages are similar in that both types of financing allow you to use the equity you’ve built in your home. However, the two options differ in how they affect your existing mortgage and monthly payments. For instance, a refinance pays off your current mortgage and replaces it with a new home loan.

Why are second home refinance rates so high?

Second home mortgage refinance rates are influenced by many factors, including current market trends and your credit history and finances. Because they’re considered riskier, second home mortgages tend to come with slightly higher interest rates. Can you do a cash-out refinance to buy a second home?