Renovate the Home You Have — Without Refinancing the Rate You Love.
- Second mortgage — your first mortgage rate stays exactly where it is
- Up to 100% CLTV for qualified borrowers — past the 80% wall most banks impose
- Manual underwriting — a human reviews your full picture, not just an algorithm
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What It Really Costs to Unlock $100,000 — Two Very Different Paths
The Scenario: You owe $400,000 on your home at a locked-in 3.25% rate, and you need $100,000 for a major renovation, addition, or ADU. Here is how the math breaks down when you compare your options.
The Refinance Path
The Watermark Path*
*Illustrative example only. Assumes an existing $400,000 first mortgage at 3.25% and a $100,000 Expanded Access second mortgage at 7.99% initial note rate (Tier 2 pricing), APR 10.157%, variable during the 60-month interest-only period; the payment increases after month 60 when principal repayment begins. Refinance figures assume a $500,000 loan at approximately 7.0% and are shown for comparison only — they are not a rate quote. Actual loan terms depend on individual creditworthiness, property eligibility, income verification, and underwriting approval. This is not a commitment to lend.
Three things that make this different from what you’ve probably seen.
Second position. Not a refinance.
Your existing first mortgage stays exactly where it is — you rate, term, payment, everything. This is a separate second mortgage that sits behind your first loan. You keep the low rate you spent years protecting.
A human reviews your application.
Instead of an algorithm reading a point-in-time snapshot, a person reviews your full financial picture — helpful for self-employed borrowers, variable income, or anyone whose numbers need context. Manual underwriting doesn’t guarantee approval; it means a fair, complete review.
Up to 100% combined loan-to-value.
For qualified borrowers with 720+ FICO, we can go to 100% of your home’s current value — so you can fund the whole project, not a piece of it. For 660–719, up to 90% for primary residences. Past the 80% ceiling that stops most traditional lenders. AVM accepted in many cases — often no physical appraisal required.
This may be worth a conversation if:
- You’re planning a renovation, addition, ADU, or major home project
- You own a primary residence with meaningful equity
- You have a first mortgage rate you don’t want to give up through a refinance
- You’d rather not drain your savings or take on a variable-rate HELOC
- Your credit score is 660 or above
This probably isn’t the right fit if:
- Your credit score is below 660
- You need more than $250,000
- The project is small enough that savings or a personal loan makes more sense
- The property is an investment property or rental
- Product not available in Texas or West Virginia
What people say about working with Watermark Home Loans
- Reviews reflect individual customer experiences and are not a guarantee of future results, rates, or terms.
Three questions worth answering before you reach out
No. The Expanded Access loan is a second mortgage that sits behind your first loan in a separate position. Your first mortgage’s rate, term, balance, and monthly payment are completely unaffected. You’ll have two separate payments — your existing first mortgage and this second mortgage — but your first mortgage is untouched.
A cash-out refinance replaces your entire first mortgage — so you re-rate everything you’ve borrowed, and your low rate is gone. A HELOC is a variable line of credit where your available balance can be frozen or reduced by the lender. The Expanded Access loan provides a single lump-sum disbursement as a traditional second mortgage: your first mortgage remains entirely untouched, you receive your full funding up front, and you only pay the new rate on the new capital.
Your home is collateral for this loan, just as it is for your first mortgage. If payments aren’t made, there is a risk of foreclosure — that’s true of any mortgage product and we won’t minimize it. The product makes sense for borrowers who clearly understand the payment structure, including that the monthly payment increases after the 5-year interest-only period ends. Our job in the first conversation is to make sure you understand exactly what you’re considering before moving forward.
The loan is structured as a 5/20 hybrid ARM. For the first 60 months, your required payment covers interest only — keeping the monthly obligation lower. During this period, the rate is variable, indexed to the WSJ Prime Rate with defined caps and a 5.99% floor. After month 60, the loan converts to a fully amortizing fixed-rate loan for the remaining 20-year term. Your payment increases at month 61 because principal repayment begins. A Watermark specialist will walk you through specific payment illustrations based on your loan amount and credit profile.
The most common limitation is the 80–90% Combined Loan-to-Value (CLTV) cap imposed by conforming lenders. The Expanded Access loan was designed to reach beyond that ceiling for qualified borrowers, and it is manually underwritten, so a person reviews your full picture instead of a single automated cutoff. If you’ve been declined or limited by a traditional lender’s CLTV cap, your situation may look different here.
If you have a renovation you’ve been putting off because refinancing would cost you your low rate — the math deserves a serious look.
No hard credit pull. No application required. No pressure to move forward. Just a short conversation with a Watermark loan specialist who will look at your specific numbers and tell you honestly what’s possible.
See What May Be Possible
- No hard credit pull. No obligation. No pressure.
This page is provided for informational purposes only and is not an offer of credit or a commitment to lend. All loan examples shown are illustrative only and do not represent actual loan terms. The Expanded Access Home Equity Loan is available for primary residences only in states where Watermark Home Loans is licensed. Not available in Texas or West Virginia. The Expanded Access loan is a 5/20 hybrid ARM — the rate is variable during the 60-month interest-only period and converts to a fixed rate for the remaining term. Monthly payment will increase after the interest-only period ends. Loan approval is subject to creditworthiness, income verification, property eligibility, and underwriting review. Your home is collateral — failure to repay could result in foreclosure. Nick Joutz, Individual MLO NMLS #9220. Watermark Home Loans NMLS #1838. Equal Housing Lender. © 2026 Watermark Capital, Inc. All rights reserved.
