property calculator

Second Mortgage Calculator

Borrowing capacity against a combined loan-to-value ceiling, the payment, and the blended rate across both liens.

Available Equity = (Home Value × Max CLTV%) − First Mortgage Balance, with combined loan-to-value ceilings usually 80-85%. Example: a $540,000 home with a $305,000 first mortgage at an 85% ceiling allows $154,000; borrowing $90,000 at 8.75% over 15 years costs $899.50 a month and takes combined LTV to 73.15%, for a blended rate of 4.89% across both liens.

Quick actions: Save inputs, view saved runs, print, share, or export results

Saved Runs

Inputs

Home Value$

First Mortgage Balance$

Maximum Combined LTV%

Amount You Want to Borrow$

Second Mortgage Rate%

Second Mortgage Termyrs

First Mortgage Payment$

First Mortgage Rate%

Results

Second Mortgage Amount

$90,000

Available Equity at This Ceiling$154,000

Shortfall Against Request$0

Monthly Payment$899.50

Total Interest$71,911

Total Paid$161,911

Cost Per $1,000 Borrowed$9.99

Current Loan-to-Value56.48%

New Combined Loan-to-Value73.15%

Combined Mortgage Balance$395,000

Combined Monthly Payment$3,049.50

Blended Rate4.89%

Remaining Equity$145,000

Tip

Useful before applying — the ceiling, not your request, usually decides how much you can actually borrow.

Formula

Second mortgage formulas

Available Equity = (Home Value × Max CLTV%) − First Mortgage Balance
Loan Amount = min(Requested, Available Equity)

Monthly Payment = Loan × [ r(1+r)ⁿ ] ÷ [ (1+r)ⁿ − 1 ]
New CLTV = (First + Second) ÷ Home Value × 100

Blended Rate = (First × First Rate + Second × Second Rate)
                ÷ (First + Second)

The combined loan-to-value ceiling, not your request, is what usually decides the loan size — and because the ceiling is applied to appraised value, every dollar of appraisal shortfall costs you 80 to 85 cents of borrowing capacity. The blended rate is the number that answers the real question when you already hold a cheap first mortgage: borrowing at 8.75% behind a large 3.75% balance is a very different proposition from refinancing everything at a single new rate.

Step by step

How the calculation works

1Enter the home's current value and the first mortgage balance. Value drives capacity more than most people expect — at an 85% ceiling, $10,000 of appraised value is $8,500 of borrowing room. The [home equity calculator](/calculators/home-equity-calculator) shows the underlying position before any lender ceiling is applied.
2Set the combined loan-to-value ceiling your lender uses. Eighty to eighty-five percent is standard on a primary residence with strong credit; investment properties, second homes, and thinner credit files get less.
3Second mortgage rates run one to three points above first mortgage rates because the second lienholder is repaid only after the first in a foreclosure. That risk premium is the price of leaving a cheap first mortgage undisturbed.
4Read the blended rate before comparing against a refinance. When the existing first mortgage is well below market, keeping it and adding a second usually wins; when it is at or above market, a cash-out refinance is normally cheaper — run it through the [refinance break-even calculator](/calculators/refinance-break-even-calculator).
5If the spending is staged or uncertain rather than a single known amount, the revolving alternative may suit better. The [HELOC calculator](/calculators/home-equity-line-of-credit-heloc-calculator) prices that structure, including the payment jump when the draw period ends.

Related guides

Learn more about this calculation

Guide

Loan-to-Value Ratio: LTV Formula, Equity, and PMI

Learn how to calculate loan-to-value ratio, why lenders use LTV, how equity works, and how the DTC LTV calculator interprets the result.

Guide

How to Use Do The Calculation Calculators: A Practical Step-by-Step Guide

Learn the fastest reliable workflow for using Do The Calculation calculators, reading results, checking formulas, and using save, print, share, and export actions correctly.

Property Tool

Home Equity Calculator

The underlying position, before a lender ceiling is applied to it.

Property Tool

HELOC Calculator

The revolving alternative, for staged or uncertain spending.

Property Tool

Refinance Break-Even Calculator

Whether replacing the first mortgage beats adding a second lien.

Property Tool

Interest-Only Mortgage Calculator

The payment-shock arithmetic a HELOC draw period repeats.

property calculator

Second Mortgage Calculator

Borrowing capacity against a combined loan-to-value ceiling, the payment, and the blended rate across both liens.

Quick actions: Save inputs, view saved runs, print, share, or export results

Saved Runs

Inputs

Home Value$

First Mortgage Balance$

Maximum Combined LTV%

Amount You Want to Borrow$

Second Mortgage Rate%

Second Mortgage Termyrs

First Mortgage Payment$

First Mortgage Rate%

Results

Second Mortgage Amount

$90,000

Available Equity at This Ceiling$154,000

Shortfall Against Request$0

Monthly Payment$899.50

Total Interest$71,911

Total Paid$161,911

Cost Per $1,000 Borrowed$9.99

Current Loan-to-Value56.48%

New Combined Loan-to-Value73.15%

Combined Mortgage Balance$395,000

Combined Monthly Payment$3,049.50

Blended Rate4.89%

Remaining Equity$145,000

Tip

Useful before applying — the ceiling, not your request, usually decides how much you can actually borrow.

Summary

Key output metrics

Loan Amount Available

$90,000

$154,000 of equity available at this ceiling

Monthly Payment

$899.50

$9.99 a month per $1,000 borrowed

Blended Rate Across Both Liens

4.89%

On $395,000 of combined mortgage debt

D3 visualization

The Home Value, Divided

What the first mortgage holds, what the second would add, and the equity cushion left between combined debt and value.

First mortgage$305,000

Second mortgage$90,000

Remaining equity$145,000

Guide

How to understand and use this calculator

Quick Answer — How Much Can You Borrow on a Second Mortgage?

Lenders size a second mortgage against a combined loan-to-value ceiling, typically 80% to 85% of the home's value across both liens together. Your request is capped by that, not the other way around.

Available Equity = (Home Value × Max CLTV%) − First Mortgage Balance
Loan Amount = the lesser of what you request and what is available
New CLTV = (First Mortgage + Second Mortgage) ÷ Home Value × 100
Monthly Payment = the ordinary amortisation formula on the second-lien balance

Worked example: a $540,000 home with a $305,000 first mortgage, against an 85% CLTV ceiling. The ceiling is $459,000, so available equity is $154,000. A $90,000 request fits comfortably.

At 8.75% over 15 years the payment is $899.50 a month, with $71,910.68 of total interest — $9.99 a month per $1,000 borrowed. Combined with a $2,150 first-mortgage payment, total housing debt service is $3,049.50. Combined LTV rises from 56.48% to 73.15%, and the blended rate across both liens is 4.89%, because a large low-rate first mortgage dilutes an expensive second.

How to Use This Calculator: $90,000 Behind a $305,000 First

Enter the home's current value and the balance on your first mortgage. Value matters more than you might expect: at an 85% ceiling, every $10,000 of appraised value is $8,500 of borrowing capacity, so an appraisal that comes in low can reduce what you can borrow far more than it reduces your equity. The home equity calculator shows the underlying position.

Set the CLTV ceiling your lender uses. Eighty to eighty-five percent is standard on a primary residence with strong credit; investment properties, second homes, and weaker credit profiles get less, sometimes considerably less. Here, 85% of $540,000 is $459,000, leaving $154,000 of room behind the $305,000 first.

Second mortgage rates run above first mortgage rates, typically by one to three points, because the second lienholder is paid only after the first in a foreclosure. At 8.75% over 15 years, $90,000 costs $899.50 a month and $71,910.68 in interest — roughly 80% of the amount borrowed, which is what a shorter term at a higher rate produces.

The blended rate of 4.89% is the number worth carrying away. It answers the question that actually matters when you already hold a cheap first mortgage: what does the total debt on this house cost? Borrowing $90,000 at 8.75% behind $305,000 at 3.75% is very different from refinancing the whole $395,000 at, say, 6.5% — the second mortgage keeps the cheap money in place. That comparison belongs in the refinance break-even calculator, and it is the main reason second mortgages regained popularity when rates rose.

A Second Example: When the Ceiling Binds

Requests are often larger than capacity. Take a $380,000 home with a $240,000 first mortgage and an 80% ceiling — common on a property that is not a primary residence or where credit is thinner.

The ceiling is $304,000, so available equity is only $64,000 against a $100,000 request: a shortfall of $36,000. The loan is capped at $64,000, which takes combined LTV to exactly 80.00%. At 9.5% over 20 years the payment is $596.56 and total interest is $79,175.35 — more interest than on the larger loan in the first example, because a longer term at a higher rate compounds in both directions.

Note what happens to the blended rate: 6.93%, against 4.89% in the first example. The first mortgage here is at 6.25% rather than 3.75%, so it dilutes the expensive second far less. The case for a second mortgage over a full refinance is strongest when the first mortgage rate is well below market and weakest when it is not — if your first mortgage is already at market rate, a cash-out refinance is usually the cheaper route to the same money.

The $76,000 of remaining equity is the other thing to watch. It is the cushion between combined debt and value, and at an 80% CLTV it is thin: a 20% fall in the home's value would leave the property worth less than the loans against it. Second mortgages are cheap relative to unsecured borrowing precisely because the house secures them, and that is the risk being priced.

Second Mortgage, HELOC, or Cash-Out Refinance?

A home equity loan (this calculator) is a fixed-rate lump sum. You take the whole amount at closing and repay it on a set schedule, which suits a known one-off cost: a specific renovation, a debt consolidation with a fixed balance, a defined bill. The payment never changes.

A HELOC is a variable-rate revolving line. You draw what you need during a draw period of usually five to ten years, paying interest only on what is drawn, then repay over a further ten to twenty. That flexibility suits uncertain or staged spending, at the cost of rate risk and a payment jump when the draw period ends — the HELOC calculator models that structure, and the interest-only mortgage calculator shows the same payment-shock arithmetic in a first-lien context.

A cash-out refinance replaces the first mortgage entirely. One loan, one payment, usually at a lower rate than a second mortgage — but you give up the rate on your existing first mortgage and pay a full set of closing costs. When your current rate is well below market, that trade is usually terrible; when it is at or above market, it is usually better than a second lien.

Two practical points. Closing costs on a second mortgage are lower than a refinance but rarely zero, and lenders offering "no cost" seconds normally price that into the rate. And a second lien has to be subordinated if you later refinance the first — the second lender must agree to stay behind the new first mortgage, which they usually do but not always, and not always quickly. Taking a second mortgage makes a future refinance of the first modestly more complicated.

Limitations

This calculator assumes the home value you enter is what a lender's appraisal will support, which is the assumption most likely to be wrong. Automated valuation estimates and recent neighbour sales are not appraisals, and at an 85% ceiling every dollar of appraisal shortfall reduces borrowing capacity by 85 cents. It also assumes a single fixed-rate fully amortising second lien; HELOCs, balloon-structured seconds, and interest-only seconds all behave differently.

It does not include closing costs, appraisal fees, title work, or any lender points, all of which reduce the net proceeds below the loan amount shown. Nor does it model the tax treatment of the interest, which depends on how the funds are used and on whether you itemise — rules on deductibility of home equity interest are specific and are not something a payment calculator can determine.

The CLTV ceiling is entered by you and treated as fixed. Real ceilings vary with credit score, occupancy, property type, income documentation, and the lender's own appetite, and the rate typically worsens as CLTV rises rather than staying flat up to the limit. The blended rate is a balance-weighted average, which is a useful summary but not an internal rate of return across two different amortisation schedules. This is a general educational tool, not lending or tax advice — compare full loan estimates and consult a qualified professional.

Related Calculators

Start from the underlying position with the Home Equity Calculator, which shows what you own before a lender's ceiling is applied. If your spending is staged or uncertain rather than a single known amount, the HELOC Calculator prices the revolving alternative, and the Interest-Only Mortgage Calculator shows the payment shock that structure creates when the draw period ends. Before choosing a second lien over replacing the first, run the Refinance Break-Even Calculator — the answer turns almost entirely on how far below market your existing rate is. The Loan-to-Value Ratio guide explains the ceiling that governs all of this.

Related concepts

Combined Loan-to-Value

All mortgage liens against the home divided by its value. The ceiling that decides how much a second mortgage can advance.

Lien Position

The order in which lenders are repaid after a foreclosure. Second position is why second mortgage rates sit above first mortgage rates.

Subordination

A second lender's agreement to stay behind a newly refinanced first mortgage. Usually granted, occasionally not, and never automatic.

Frequently Asked Questions

How much can I borrow with a second mortgage?+

Take the home's value times the lender's combined loan-to-value ceiling and subtract the first mortgage balance. On a $540,000 home with a $305,000 first mortgage at an 85% ceiling, that is $459,000 − $305,000 = $154,000 of available equity.

What is combined loan-to-value?+

The total of all mortgage liens divided by the home's value. Adding a $90,000 second behind a $305,000 first on a $540,000 home takes CLTV from 56.48% to 73.15%. Most lenders cap it at 80% to 85% on a primary residence, and lower on investment properties.

Why are second mortgage rates higher?+

Because the second lienholder is repaid only after the first in a foreclosure, so the risk is greater. Rates typically run one to three points above first mortgage rates — 8.75% against 3.75% in the worked example.

What is a blended rate and why does it matter?+

The balance-weighted average rate across both liens. Borrowing $90,000 at 8.75% behind $305,000 at 3.75% gives a blended 4.89%, which is the honest comparison against refinancing everything at a single new rate. It is why second mortgages make sense when the existing first is cheap.

Should I take a second mortgage or a cash-out refinance?+

It depends almost entirely on your current first mortgage rate. Well below market, keep it and take a second — the blended rate wins. At or above market, a cash-out refinance is usually cheaper despite the closing costs, because it prices the whole balance at the new rate.

What is the difference between a second mortgage and a HELOC?+

A home equity loan is a fixed-rate lump sum on a set repayment schedule, suited to a known one-off cost. A HELOC is a variable-rate revolving line you draw as needed, suited to staged or uncertain spending, with rate risk and a payment jump when the draw period ends.

What happens if I want to refinance the first mortgage later?+

The second lender must agree to subordinate — to stay behind the new first mortgage rather than moving into first position. They usually do, but not always and not always quickly, so a second lien makes a future refinance of the first modestly more complicated.

How much equity should I leave in the house?+

At an 80% CLTV, a $380,000 home with $304,000 of combined debt has $76,000 of cushion — enough to absorb a 20% price fall and no more. The house secures the loan, which is exactly why the rate is lower than unsecured borrowing, and exactly what is at risk.

Formula

Second mortgage formulas

Available Equity = (Home Value × Max CLTV%) − First Mortgage Balance
Loan Amount = min(Requested, Available Equity)

Monthly Payment = Loan × [ r(1+r)ⁿ ] ÷ [ (1+r)ⁿ − 1 ]
New CLTV = (First + Second) ÷ Home Value × 100

Blended Rate = (First × First Rate + Second × Second Rate)
                ÷ (First + Second)

Step by step

How the calculation works

1Enter the home's current value and the first mortgage balance. Value drives capacity more than most people expect — at an 85% ceiling, $10,000 of appraised value is $8,500 of borrowing room. The [home equity calculator](/calculators/home-equity-calculator) shows the underlying position before any lender ceiling is applied.
2Set the combined loan-to-value ceiling your lender uses. Eighty to eighty-five percent is standard on a primary residence with strong credit; investment properties, second homes, and thinner credit files get less.
3Second mortgage rates run one to three points above first mortgage rates because the second lienholder is repaid only after the first in a foreclosure. That risk premium is the price of leaving a cheap first mortgage undisturbed.
4Read the blended rate before comparing against a refinance. When the existing first mortgage is well below market, keeping it and adding a second usually wins; when it is at or above market, a cash-out refinance is normally cheaper — run it through the [refinance break-even calculator](/calculators/refinance-break-even-calculator).
5If the spending is staged or uncertain rather than a single known amount, the revolving alternative may suit better. The [HELOC calculator](/calculators/home-equity-line-of-credit-heloc-calculator) prices that structure, including the payment jump when the draw period ends.

Related guides

Learn more about this calculation

Guide

Second Mortgage Calculator

Inputs

Results

Second mortgage formulas

How the calculation works

Learn more about this calculation

Loan-to-Value Ratio: LTV Formula, Equity, and PMI

How to Use Do The Calculation Calculators: A Practical Step-by-Step Guide

Home Equity Calculator

HELOC Calculator

Refinance Break-Even Calculator

Interest-Only Mortgage Calculator

Key facts

Second Mortgage Calculator

Inputs

Results

Key output metrics

The Home Value, Divided

How to understand and use this calculator

Quick Answer — How Much Can You Borrow on a Second Mortgage?

How to Use This Calculator: $90,000 Behind a $305,000 First

A Second Example: When the Ceiling Binds

Second Mortgage, HELOC, or Cash-Out Refinance?

Limitations

Related Calculators

Related concepts

Frequently Asked Questions

Second mortgage formulas

How the calculation works

Learn more about this calculation

Loan-to-Value Ratio: LTV Formula, Equity, and PMI

How to Use Do The Calculation Calculators: A Practical Step-by-Step Guide

Home Equity Calculator

HELOC Calculator

Refinance Break-Even Calculator

Interest-Only Mortgage Calculator

Key facts

Key output metrics

The Home Value, Divided

How to understand and use this calculator

Quick Answer — How Much Can You Borrow on a Second Mortgage?

How to Use This Calculator: $90,000 Behind a $305,000 First

A Second Example: When the Ceiling Binds

Second Mortgage, HELOC, or Cash-Out Refinance?

Limitations

Related Calculators

Related concepts

Frequently Asked Questions