Vacation Home Loan, Second Home Loan

Found that perfect vacation home?  The realities of financing a non-primary residence are slightly different than for an owner occupied primary residence.  Mortgage lenders perceive the second home as more “dispensable” than the primary home (you would be more likely not to pay the second home loan payment vs. the first home loan payment if you were in a financial bind).  Also many people stretch their finances to be able to afford a second or vacation home.  Lenders have higher risks in financing a second home, and as such they charge a premium in the form of a higher interest rate, higher fees, and/or points.

In most cases it makes sense to get pre-approval for a second home loan before home shopping, however in practicality many people stumble onto a place they’d love to buy on accident – then try to get financing.  Either way, a LoanEXA Home Loan Advisor can assist with your pre-approval or help you close the vacation home you’ve already found!

It’s highly important to get multiple home loan interest rate quotes online for a second home loan, as mortgage lenders adjust their interest rates to price in the increased risk for a second home loan.  Second home loan interest rates will vary widely as opposed to a primary residence home loan, and this wide variance makes finding the best rate highly valuable!