Junior Mortgage
A mortgage which is subordinate to a first or prior (senior) mortgage. Frequently called a second mortgage, this could also be a third or fourth mortgage, etc. In the case of foreclosure, the senior mortgage will be paid down first. Investopedia Says:
Common uses of junior mortgages include piggy-back mortgages (80-10-10 mortgages) and home equity loans. Piggy-back mortgages provide a way for borrowers with less than a 20% down payment to avoid costly private mortgage insurance. Home equity loans are frequently used to extract equity for a home to pay down other debts or make additional purchases. Every borrowing scenario should be carefully and thoroughly analyzed. Related Terms:
80-10-10 Mortgage
Home-Equity Loan
Loan to Value - LTV
Piggy-Back Mortgage
Second Mortgage |