Buying a Second Home
A Mortgage for Your Perfect Second Home
Intelliloan’s Home Loan Specialists will help you find the most effective mortgage loan to match your needs. We have a range of mortgage options to enable you to finance and buy a second home with a low down payment.
With an Intelliloan® preapproval, your offer will have more bargaining leverage. Agents and sellers will understand you have your paperwork ready and are prepared to buy.
If you need help with choosing a real estate agent, we have partners who will match you with the right agent in your area.
Every day we are helping Americans buy a second home. Contact us at 833-984-2471 for assistance, or simply complete this online form and we will reach out to you.
Recommended Loan Options for Your Second Home
A conventional fixed rate loan will provide the security of knowing the rate is fixed for the life of the loan on your second home. Choose a longer repayment term for smaller monthly payments or a shorter term to pay off the loan faster. Call us to know how low your monthly payment could be for your second home.
What is a Second Home?
The home you buy can be classified in one of three ways: primary residence, second home, or an investment property. The type of home you are buying will impact both your interest rates and your eligibility for mortgage interest deduction.
You may require a higher credit score in order to qualify for buying a second home, and your interest rate could be higher due to the lender’s increased risk. However, neither of these may happen in your case because each situation is unique. A second home will have these key characteristics:
It should be reasonably distant from your primary home.
It should be under your exclusive control and not subject to a timeshare, rental, or property management agreement.
You should live there for some time during the year, or someone else could live in your home subject to time limits placed by some lenders.
Your second home should be accessible by a motor vehicle year-round.
How to Buy Your Second Home?
If you have a favorite destination that you visit often for leisure or work, getting a second home there could be more cost-effective in the long run than paying for a hotel. However, you must consider factors such as your budget, insurance, and maintenance as well as location.
It is vital to budget carefully when having to manage two monthly mortgage payments, unless your primary home is clear and free.
For a mortgage investor, a second home loan presents an increased risk. Therefore, they may require you to make a slightly higher down payment as an assurance that you are in a position to afford it. This will also secure for you a lower initial rate before it is adjusted at the end of the fixed period.
For your second home, the mortgage interest rate should be slightly higher. In other words, your monthly payment on your second home would be a tad bit higher than what you would normally have on a primary home.
Occupancy Rule
To ensure that your property is classified as a second home, you are required to spend some time of the year there. Having said that, if your mortgage is backed by Freddie Mac or Fannie Mae, you could rent out the property for up to 180 days, and avoid its classification as an investment property.
Maintenance Handling
Since your second home will remain unoccupied for at least some part of the year, you should plan on how you would like to handle the maintenance issues, if any, related to electrical systems, water and drainage, and security systems.
Homeowners Insurance
The homeowners’ insurance rates on your second home will be slightly higher. The home’s location could also affect the rates.
If the idea of buying a second home appears viable, you should submit this online form right away to get started, or call one of our Intelliloan® Home Loan Specialists at 833-984-2471 today.