Mortgages For Second Homes and Investment Properties - Still Viable

Mortgage and Lending with Strategic Mortgage NMLS#160440


In today’s mortgage marketplace, many home loan products that seem to go away for some time are making a strong come back, but in ways that makes sense. Home loans for second homes or in other words, vacations homes and home loans for investment properties are available and viable in today's mortgage market. Of course, the standards are a little different than for the purchase of a primary residence (a home you will live in), but there are still affordable options given the current level of interest rates and house prices.



 For starters, you will need a down payment for the purchase of a second home or investment property and it will be need to be more than 0% or 3.5% as you cannot use a FHA home loan or VA loan to purchase one of these properties.



 Second homes or vacation homes are homes that a homeowner does not live in year around, but does also not rent out. These homes generally have to be in a different metropolitan area then where the homeowner lives primarily. For instance, if you own a primary residence in Phoenix, you may call a home in Tucson or Sedona a second home, but you may not call a home in Scottsdale a second home.



 For second homes, you can now purchase a home with a little as 15% down payment. However, with a 20% down payment your interest rate will be even better. In fact, if you put 20% down on the purchase of a second home or have 20% equity when refinancing a second home, you can expect to receive an interest rate similar to that of a primary residence. 



 On the other hand, when looking at an investment property, generally a 20% down payment will be required. In fact, with a 25% down payment, interest rates will be even better. However, you will still see a slight bump for interest rates on investment homes, as opposed to primary residences and secondary homes. Investment homes will be any home that a homeowner does not live and owns for investment purposes, whether rented out or not. Also, any home in the same metropolitan area will also be considered a rental property.



 These are just some of the basics of second home and investment property home loans. In the current marketplace, these mortgage products are making a comeback in a smart and sensible way and can be a good option for any homeowner who is looking to purchase an additional home.



For more information on  current home loan programs and options for existing and potential home owners, please contact Bill Kamboukos of Strategic Mortgage at (480) 219-3682 or by emailing: or online at 



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