Which instrument, whose consent, in what order.
A registered second mortgage, a caveat supported by a contingent mortgage, and a caveat-only facility are three different things. They need different consents and settle on very different timelines. On a deal with a fixed settlement date, choosing the wrong one is how you miss it.
1. How large is the facility?
2. How long is the term?
3. Who holds the first mortgage?
4. How long until settlement?
5. Is the first mortgagee’s formal written consent obtainable?
6. Does the incoming lender require a registered position?
How to read this. This is a commercial description of how these structures are used in practice, not legal advice, and security instruments have significant legal consequences. Registration requirements, caveatable interests and priority arrangements differ between states and turn on the actual documents. Obtain your own legal advice before granting or taking any security, and never rely on an assumption about first-mortgagee consent — get it in writing. General information only, not financial product advice or credit assistance, and not an offer of finance.
Size it as well as structure it
Once the instrument is settled, the next question is what the advance actually delivers after retained interest, fees and anything cleared at settlement.
Open the sizing calculator