A collateral mortgage can be beneficial or detrimental - it depends on your financial circumstances. Suppose your finances are in stellar shape, and you can acquire a collateral mortgage with a low interest rate. In that case, you’ll likely experience little difficulty in keeping up with payments, both on the mortgage and any funds you borrow through the line of credit. Conversely, suppose your financial situation rapidly deteriorates. In that case, you can quickly fall behind on your payments, putting your home in danger of foreclosure. If you’re risk-averse or financially vulnerable, it’s probably wise to avoid a collateral mortgage.