How can you finance a vacation home?

Do you have a favorite vacation destination? A place that you love returning to again and again? If a particular sun-kissed beach or mountainside lake comes to mind, we have a question for you. Why haven’t you bought a vacation home there yet?

Buying a vacation home is a big deal. But it can be a great way to make your favorite vacation destination feel a little more like home. When you own a vacation home, you always have a place to stay where you can completely relax and unwind without a care in the world. You never have to worry about scrambling to find hotel reservations or booking the right Airbnb during busy tourist seasons. Owning a vacation home may even help you money on premium rates during busy seasons!

But saving on hotel costs when you vacation isn’t the only reason you should consider buying a vacation home. There are a lot of benefits that you will soon discover once you buy the right home. But before you can do that, you must finance your vacation home purchase. If you’re unsure how to finance a vacation home, we have a few tips that may help you.

• Save: The simplest option is to save up enough to buy the home outright or put down a large down payment for a second mortgage. If you’ve got some savings you want to invest in a property, use them for your vacation home!
• Take out an investment property loan. We offer several investment property loans that may help you finance a second property. Visit your nearest PRMI office to speak to a loan advisor about your situation and see if an investment loan is a right option for you.
• Use your home equity. Another option for financing a second property is to utilize the equity you already have on your existing property. You can do this in a few ways with a cash-out refinance or a home equity line of credit (HELOC). Both options require using your home as collateral and taking on more debt, so make sure they are the best option. Your PRMI loan advisor can give you sage advice to help you make the right decision.

Buying a vacation home isn’t the same as buying your first home. For one, you already have an established history as a property owner and built-up equity. Secondly, you can also earn income from your vacation home by turning it into a rental property when you’re not staying there. Those are just a few ways things are different when buying a vacation home. So if you’re ready to take the plunge and purchase a property at your favorite vacation destination, we can help!