Is a second mortgage better than refinancing?

Sometimes. A second mortgage can make sense when breaking or replacing the first mortgage is too expensive. A refinance may be cleaner when the long-term payment and total cost are better.

Are second mortgage rates higher?

Usually yes. The second lender has higher risk because the first mortgage is paid first if the property is sold or enforced.

What is the exit plan for a second mortgage?

Common exits include refinancing both mortgages later, selling the property, using improved income or credit to move back to a lower-cost lender, or paying down the balance from a defined cash event.

Second Mortgages in Canada | Costs, Risks, Alternatives

A second mortgage protects the first mortgage only when the math supports it

The cost is usually higher than first-mortgage financing because the second lender sits behind the first lender. Product fit depends on total payment, equity cushion, and the exit plan.

When a second mortgage can fit

Second mortgages can be useful for short-term debt consolidation, tax arrears, renovations, or temporary liquidity, but the payment must work under real household cash flow.

The first mortgage is worth keeping because its rate, penalty, or terms are better than a full refinance.
The borrowing need is defined and the property has enough equity to support a second charge.
The borrower has a clear route to repay, refinance, sell, or consolidate the second mortgage before renewal pressure builds.