AND SUBSEQUENT MORTGAGES
the registered proprietor retains the ownership of the land
and can create second and subsequent mortgages over the land. The
rights of the second or subsequent mortgagee are subject to those of
the first or previous mortgagee. When buying property, sometimes
additional money is required to bridge the deposit gap and this can
be achieved by way of a second mortgage.
The first lender
(first mortgagee) has to agree to the borrowing of additional money.
Usually the first and second mortgage repayments should not exceed
30% of the applicant's gross income. It is higher for subsequent
mortgages because any remedy for default is as the discretion of the
first mortgagee. Common sources of additional finance are:
- building societies have their own second
mortgage scheme or alternatively may offer a low start loan that would enable
the applicant to borrow a larger amount on the first mortgage.
- savings banks may offer additional money
with a personal loan.
- trading banks
- credit unions
- private lenders.