What is referred to as the term for the buyer signing for a second loan?

The correct term for the buyer signing for a second loan is known as a second mortgage. A second mortgage is a type of subordinate loan that allows homeowners to borrow against the equity in their home, which is the difference between their home's market value and the amount owed on the existing mortgage. The second mortgage is secured by the property, just like the primary mortgage, but it comes in second in priority for repayment. This means that in the event of a foreclosure, the primary mortgage must be paid off first before the second mortgage lender can recoup any funds.

In contrast, a home equity line of credit (HELOC) is a revolving line of credit secured by the equity in the home, similar to a second mortgage, but is structured more like a credit card where the homeowner can borrow and pay back as needed. Refinancing refers to replacing an existing mortgage with a new one, often to obtain better terms, while a fixed-rate loan is a type of mortgage with a consistent interest rate throughout the loan term. These terms highlight different aspects of mortgage financing but do not describe the action of taking on a second loan secured by the property.