A "second mortgage" is anything that lienholds your home behind your primary mortgage — a home equity loan, HELOC, or purchase-money piggyback second. The calculator combines them to show your total housing payment and DTI. That is the number that matters when you are deciding whether you can actually afford the combined debt.
Worked example: First mortgage balance $285,000 at 3.75% = $1,320 P&I. Proposed second of $60,000 at 8.75% over 15 years = $600/mo. Combined payment = $1,920. Add $400 tax + $130 insurance = $2,450 total housing. On a $9,500/mo gross income, that is 25.8% front-end DTI — still safely under 28%.
Why a second beats a refi when your first mortgage rate is low
The dominant mortgage decision of 2024-2026: do not refinance your 3-4% first mortgage to access equity. The rate sacrifice is enormous. A second mortgage or HELOC preserves the low first rate and isolates the cost of new borrowing to the new money only.
Piggyback seconds for purchase
Some buyers use a purchase-money second to avoid PMI or jumbo pricing. Classic 80/10/10 structure: first mortgage at 80% LTV (no PMI), second at 10% LTV, buyer 10% down. Works great when second-mortgage rates are reasonable. In 2026, with second-mortgage rates near 9%, the PMI savings often do not justify the higher second rate — run both scenarios.