Not many people know this but the term second mortgage means the same thing as a home equity loan. Just because you're taking out a loan against your house for the second (or third, fourth or more) times doesn't mean it's a "second mortgage"

In connection with this, be aware that "no credit check" loans normally require you to use some form of equity as collateral, very often your own home.

A second mortgage or home equity loan is the home loan that you apply for when you still have an outstanding balance to pay on your first mortgage. In this case, the lender will place a lien on your home as a means of security; in other words, your house is used as collateral in case you default on the second mortgage.

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Usually, it's ideal to obtain the second mortgage from the financial institution that you currently have the first loan from. Try to negotiate for a good deal, and pursue a lower loan rate, or less stringent terms and conditions or even more flexible repayment options.

At the same time do check out offers from competing lenders - present your case, and inform them of your intention to borrow from your current bank or lender unless they can offer better rates or deals. Because of the competitive nature of the home mortgage industry, you'll very often end up getting free quotes and offers from multiple lenders, all eager for your business. A little leg work can end up saving you a lot of money.

Another tip is to consider refinancing your home AND requesting for a second mortgage. This is the preferred approach if the current loan rate you're paying is above the prevailing market interest rates. If your lender is willing, the current loan can be paid off, and a package consisting of the new loan at a lower interest rate, plus the additional home equity loan, given out to you.

The million-dollar tip here is again to shop around, getting as many quotes and deals as possible for your further evaluation. Ask if the new prospective lender is willing to absorb the possible penalty charges and other closing costs if you decide to pay off the loan with the exisiting lender and go on to the new one.

The third and final strategy is to obtain a home equity line of credit instead of a lump-sum second mortgage. This is important to understand. In a home equity line of credit arrangement, you'll be given a check book for, example $10,000 (which happens to be your line of credit), rather than the entire $10,000 amount at once. As and when you need the money, you just write the check, and you pay interest only on the check issued. Compare this with having to pay interest on the entire $10,000 in the case of a second mortgage loan package. With a home equity line of credit, you borrow only what you need, and pay off the amount owed as and when you like, very much like you would with a credit card.

In conclusion, do shop around for the best second mortgages. Remember that the best home equity loan isn't necessarily the one with the lowest interest rates; always, always check to see if any additional or hidden fees will be charged, and don't fall for deals where the extra costs are downplayed.