Are you thinking about buying a property in Hunterdon County as your second home? Perhaps you are looking for weekend home along the Delaware River where you can escape to for your vacations, or maybe you want to have another home closer to relatives? Maybe you want to rent out that second property and make a steady income from your investment. Whatever the reason, a second piece of real estate can be a fantastic investment. However, sometimes getting a mortgage on a second home can be a quite a challenge.
Generally, a mortgage lender will have stricter guidelines for second home loans as compared to primary home loans. This is because usually when you are buying a second home your finances will be stretched thinner and you will have less money to spare because you are already paying a mortgage on your primary home. This will mean that your second home mortgage can be harder to get and might have a higher interest rate.
Here are some tips to keep in mind that will help you to get the best financing on your second property:
- Build up a decent amount of savings. Your mortgage lender will want to be able to see that you have a large amount of savings so that you will have enough to pay for the mortgage even if you were to lose your job.
- Pay off any credit card debt. Many lenders will be hesitant to approve your second home mortgage if they see that you have a lot of debt on your credit card. They will also want to see that you have a low debt to income ratio so that you will be able to pay back the loan.
- Use the first mortgage as a good reference. If you have always made your payments on time and you are most of the way through paying off your first house, you could ask someone from your current mortgage company to vouch for you. The lender for your second mortgage will be reassured that you are a reliable person to loan money to.
These are just a few tips to keep in mind in order to make getting a mortgage for your second home as easy (or at least less painful!) as possible. To find out more about investing in property here in Hunterdon County, contact us by email or give us a call at 908-349-0095