- Tips to Lower your Electric BillPosted: 4 years ago
- 5 Easy Home Improvement Projects & Upgrades For the WinterPosted: 4 years ago
- Benefits to buying in the winterPosted: 4 years ago
- Cash In with a Cash-Out RefinancePosted: 4 years ago
- Mortgage MythsPosted: 4 years ago
- Q&A: All About Flooring — Hardwood, Carpeting, Tiling, LaminatePosted: 5 years ago
- Tip: 3 Foolproof Social Media Marketing TipsPosted: 5 years ago
- Tips for Hosting a Stress-Free Holiday DinnerPosted: 5 years ago
- Is a Mortgage Refinance Right for You?Posted: 5 years ago
- Check Your Disaster Supplies KitPosted: 5 years ago
- Create an Early Holiday Shopping BudgetPosted: 5 years ago
- 9 Ways to Make Moving Day EasierPosted: 5 years ago
- July 2018 Market Update – Twins Cities RegionPosted: 5 years ago
- Fall Homeowners ChecklistPosted: 5 years ago
- Scam Alert: Spoofed IRS Phone NumbersPosted: 5 years ago
- 15 Years of First Class MortgagePosted: 5 years ago
- How to buy a second homePosted: 5 years ago
- Q&A: Lawn Watering SecretsPosted: 5 years ago
- Troubleshoot Your Air ConditioningPosted: 5 years ago
- Your Mortgage, What to Expect: Clear To ClosePosted: 5 years ago
- Twins Cities Region Monthly Indicators – APRIL 2018Posted: 5 years ago
- Your Mortgage, What to Expect: UnderwritingPosted: 5 years ago
- Your Mortgage, What To Expect: Property AppraisalPosted: 5 years ago
- 3 Tips to Improve your Credit Score and Score a Lower Interest RatePosted: 5 years ago
- Changing Interest Rates Have A High Impact On Purchasing PowerPosted: 5 years ago
- The Myth of Multiple Mortgage Credit InquiriesPosted: 5 years ago
- Things to do BEFORE you buy a home.Posted: 5 years ago
- March Tech Tip: Pack Smarter With PackPointPosted: 6 years ago
- 4 Ways to Pay Off Your Mortgage EarlyPosted: 6 years ago
- Clean House in a HurryPosted: 6 years ago
- Your Mortgage, What To Expect: Document ReviewPosted: 6 years ago
- Chill Winter Utility BillsPosted: 6 years ago
- Six Tips to Help Your Home Sell This FallPosted: 6 years ago
- 4 Things to Know About Closing CostsPosted: 6 years ago
- Understanding Your Credit ScorePosted: 6 years ago
- Equifax Data Breach: What should you do now?Posted: 6 years ago
- Should You Refinance Your FHA to a Conventional Loan?Posted: 6 years ago
- 6 Ways to Save on Paint ProjectsPosted: 6 years ago
- Q&A: Mortgage InsurancePosted: 6 years ago
- How to Keep Your House Cool this SummerPosted: 6 years ago
- Mortgage Education: “What’s the Point?”Posted: 6 years ago
- Q&A: Spotting a Spoof SitePosted: 6 years ago
- Moving ChecklistPosted: 6 years ago
- Squash Marital Money SquabblesPosted: 6 years ago
- April 2017: Twin Cities Real Estate Market UpdatePosted: 6 years ago
- Your Spring Guide to Home StagingPosted: 6 years ago
- March 2017: Twin Cities Real Estate Market UpdatePosted: 6 years ago
- Don’t be a Victim — Four Ways Protect Yourself from Refinance ScamsPosted: 7 years ago
- Local Market Update: Minneapolis Area Association of RealtorsPosted: 7 years ago
- First-Time Homebuyers: Where to startPosted: 7 years ago
- Dear First Class Mortgage:Posted: 7 years ago
- First Class Mortgage. Our Expertise, Your Peace of Mind.Posted: 7 years ago
How to buy a second homePosted by
Lake season is here! If you are considering purchasing a vacation property, now is a great time. No matter what type of vacation property – lakeshore, rural or urban — you’ll follow the same basic steps when it comes to financing a second home. Here are some things to consider as you purchase a second property.
Setting a budget:
When financing a second home purchase, it’s essential to get in touch with a mortgage consultant BEFORE you begin your property search.
Together with your mortgage consultant, we will help you determine a budget that takes into account, maximum mortgage payment, annual homeowner’s insurance policy, and taxes.
While these additional expenses are not factored into your mortgage scenario, other costs to keep in mind are travel costs – to and from the property, regular maintenance & repairs, utilities, furnishings, and household items.
Financing a second home:
While some people can afford to pay cash for a vacation home, financing makes more sense for a majority of future second homeowners. Here are two options to consider:
Financing a second home is different than purchasing a primary residence. FHA home loans are not an option since they can only be used to buy a primary residence. That leaves a conventional loan, which you have to qualify for on top of any mortgage debt on your primary home.
Typically, you will need to make a down payment of at least 10 percent, meet credit standards and debt-to-income requirements, and provide documents for income and asset verification.
Home values are on the rise across the country. Because of this, many homeowners have built substantial equity in their primary residence in just the past few years. Cash-out refinancing can be an excellent way to liquidate your home equity and then use it to purchase a vacation home.
Rental vs. Vacation Home
For some, owning a vacation home may sound like an unattainable dream. But, with the rise of services like Airbnb, it is now easier than ever to receive occasional rental income.
If you do plan to rent the property out, know that financing is different for rental homes and vacation properties. Qualifying is more straightforward when purchasing a property as a second home.
Finding your dream
The market for lake homes is heating up, and new properties are being added to the market daily. If you are not already working with an agent, we would be happy to recommend some REALTORS that specialize in lakes country. They will take the time to help you find your perfect home away from home.
Once you have found a property, your First Class Mortgage consultant will help you determine the best way for you to purchase it.