Second mortgages in Mississauga and the GTA

A second mortgage sits behind your existing first. You keep the first exactly as it is, and a second lender registers a separate loan against the equity that is left.

When a second beats a refinance

• Your first mortgage is at a rate you do not want to give up.
• You need $30,000 to $150,000 and a full refinance will not close in time.
• Your lender quoted a payout penalty that makes refinancing uneconomic.
• You need to clear tax arrears, mortgage arrears or high-interest debt quickly.
• You are self-employed or credit-bruised and a bank will not increase your first mortgage.

What to check on a second

• The rate is higher because the lender is second in line if the property ever sells under pressure. It is often still the cheaper option overall.
• If your first mortgage is locked well below today's rates, breaking it to pull out $70,000 can cost $20,000 or more in penalty. A second avoids that entirely.
• A second can frequently close in one to two weeks, against three to five for a full refinance.
• Expect lender and broker fees. Ask for the total cost of borrowing in dollars, not just the rate.
• Most seconds are one year terms. Have a plan for maturity before you sign, not after.
• Compare the penalty on your first against the fees on a second. The arithmetic decides this, not the rate.

Documents to gather

• Government photo ID for each applicant
• Current first mortgage statement showing balance, rate, maturity and payout penalty
• Income confirmation, or business documents if self-employed
• Property tax bill showing the account is current
• Recent appraisal, or enough detail to estimate value
• Statements for any debt the funds will clear

How a second closes

1. 01 Confirm available equityMost lenders go to 80% of value across both mortgages, some higher at a higher price.
2. 02 Price it against a refinanceWe get your penalty in writing and show both total costs to the same date.
3. 03 Full fee disclosureRate, lender fee, broker fee and legal costs in writing before you commit.
4. 04 Close and plan the exitWe set a target date to consolidate both mortgages at renewal, when it is cheapest to do so.

Questions we get asked

How much can I borrow on a second mortgage?

Generally to 80% of the home's value across both mortgages. On a $900,000 home with a $600,000 first, 80% is $720,000, leaving roughly $120,000 of room before costs.

Are there fees on a second mortgage?

Usually a lender fee and a broker fee, plus legal costs. That is standard in this part of the market. Every figure is disclosed in writing before you sign anything.

Will a second mortgage hurt my credit?

The application creates one inquiry, then the mortgage reports like any secured loan. Paying on time helps. Missing payments on a mortgage secured against your home is far more serious than missing a credit card payment.

What happens at the end of the term?

Most seconds are one or two year terms. The usual plan is to consolidate both mortgages into one first mortgage when the first matures, which is when there is no penalty to do it.