Buying a second home can be a great way to invest your money. Diversifying your investments ensures that you don’t lose everything should the market crash and real estate is a great market to use for diversification.
Whether you’re buying a second home in another state or buying a second home to rent, knowing how to finance buying a second home is important
You may not have as many options for loan programs when buying a second home. FHA, VA, and USDA loans are only for primary residence purchases. This leaves you with conventional loans or private mortgage loans from smaller lenders.
At Priva Mortgage, we offer a variety of loans to make buying a second home in Florida easy.
To buy a second home, you must prove you can afford any mortgages left on your primary residence, plus the new mortgage. Most loan programs require you to have a large down payment (20% - 30%) and a manageable debt-to-income ratio to prove you aren’t in over your head in debt (average 36% or lower).
If you can prove these factors, you’ll be able to buy a second home and enjoy either rental income from your investment or enjoy having a second home to spend time with your family.
The reasons you’re buying a second home will determine the type of financing we can offer. For the most part, government-backed loans aren’t possible for non-primary residence homes, but you have other options to make owning a second home affordable.
First, decide how you’ll use the property, whether as an investment home to earn cash flow and capital appreciation or as a second home you’ll use throughout the year.
Next, we’ll help you determine how you’ll qualify. If you’re buying an investment home, you may be able to use the projected rental income to qualify for the loan. If not, you must be able to prove you can afford the payments on your own.
At Priva Mortgage, we offer a variety of options to help you buy a second home in Florida including fixed-rate loans, adjustable-rate loans, and sometimes even interest-only loans.
If you have a primary residence with equity in it, you may even be able to take out a home equity loan or HELOC and use the money to buy your second home.
We explore all options available to you to help you make the most out of your ability to buy a second home.
If you’re ready to learn how to finance buying a second home, whether you’re buying a second home in another state or buying a second home for an investment, the professionals at Priva Mortgage are here for you every step of the way.
Contact us today to learn more!