Getting a mortgage has gotten more difficult since the housing bubble burst and lenders had to tighten up their credit requirements. That doesn’t mean that you can’t get a mortgage, though, because there are still plenty of options. If you have good credit it’s easier to get a mortgage, but even people with bad credit can have some success if they have a big down payment and don’t have a lot of other debt. Another way a person can get a mortgage is through an equity home mortgage, which is like a home equity line of credit or second mortgage.

People who get these kinds of mortgages generally do so because they need to borrow against their house to pay other bills or to make improvements. These improvements could be anything from upgrades in the kitchen to adding a porch or even another room. No matter what they want to do with the money, they need to have enough equity in their house to get this kind of mortgage. If there’s no equity, they can’t get the loan. The bank would be taking too much of a risk by loaning against the house if the value of the house wasn’t enough to sustain that loan.

Just like a first mortgage, how much is loaned must be based on the value of the structure the loan is being made against. Anyone who’s ever taken out this type of equity line of credit knows that some banks are more than happy to loan money that way and other banks are very uncomfortable with it. There are also higher interest rates for an equity mortgage on your home, because the loan is placed in the second position if the home has to be sold at a loss or foreclosed on. That means there’s more of a risk, so the higher interest rate is required.