A second mortgage is exactly what it sounds like — a registered mortgage that ranks behind an existing first mortgage. The second-mortgage holder only sees recovery after the first mortgage is paid out in full.
Second mortgages are used to release additional capital from a property without refinancing the existing senior debt. Common scenarios: working capital ahead of a settlement, deposit release for an acquisition, or top-up cover behind a major-bank first mortgage.
Archer Wealth writes second mortgages up to 80% combined LVR (the first plus the second together can't exceed 80% of the property value). The pricing reflects the position — second mortgages typically carry a higher rate than equivalent first mortgages, because the lender's recovery is junior.
The first-mortgage lender's consent is usually required before a second can register, depending on the existing mortgage documentation.