Things to Consider Before Making Your Second Home Dreams a Reality
Will you rent it out when you’re away?
Are you thinking about turning your second home into an income source? If you plan to rent it out regularly, it might be classified as an investment property with different lending requirements. That’s why it’s essential to talk with a loan advisor who can help you align your goals with the right loan options.
How close is it to your primary home?
Did you know there are specific distance requirements for second homes? Vacation and second properties often have unique rules based on location relative to your primary residence. An APM loan advisor can help you navigate these guidelines and find the perfect loan program for your new getaway, regardless of location.
Make every season your favorite season with the perfect second home.
Whether it’s a cozy lakefront cottage, a mountainside cabin for winter escapes, a sunny desert oasis, or a beachfront condo in paradise, we’re here to make your second-home dreams a reality.
Your second home deserves financing as unique as the property itself. At PSL, we offer a wide range of loan programs tailored to your needs. Your dedicated PSL loan advisor will walk you through affordability, requirements, and all the details to get you settled into your new retreat.
While the process of buying a second home is similar to purchasing your primary residence, there are a few key differences in the qualifying factors. Here’s what to keep in mind when considering financing for your second home:
While down payment requirements for second homes can still be relatively low, they’re typically higher than for your primary home, ranging between 10% and 20%.
Lenders often require you to have reserves on hand, which are funds set aside to cover future mortgage payments. If you’re a wage earner, you’ll need at least two months of reserves. If you’re self-employed, however, this could increase to six months.
Credit requirements for second homes are generally higher than those for primary residences. Make sure your credit score is in good shape to meet these expectations.
Your income must be enough to cover both your primary home and your second home. Keep in mind, you cannot count rental income to offset your qualifying expenses unless your second home is an investment property.
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