In part one of this two-part blog series, we went over some of the general benefits that often come with purchasing a second home. For those who have the financial ability to do so, there are several potential positive outcomes associated with a second home purchase, from retirement planning benefits to vacation themes and more.
At Primary Residential Mortgage, we’re happy to offer a wide range of mortgage loans for a variety of buyers, including jumbo loans for those looking for larger homes. We’ve assisted many clients with a second home purchase, and we’d be happy to do the same for you. While part one of our series went over the common benefits of going this route, today’s part two will dig into a few important themes you should be considering if you’ve decided to enter this process.
Just like with a first home you’ve already purchased, it’s vital to do some advanced planning when budgeting for a second home mortgage and related expenses. This begins with pre-approval, so you know what your spending limit is before heading to an open house or property website.
You should also consider the additional costs of upkeep, insurance, and utilities for a second home. These expenses may not be as high as they would be for a first home mortgage, but you should still budget accordingly.
In addition, do some research on the current market rates for properties in your chosen area. This is a good way to determine the approximate value of the second home you’re considering, which can help with your financing and budgeting. Meanwhile, also keep an eye on mortgage interest rates during this process.
It’s important to note that while your ability to make certain house-related tax deductions does maintain with a second home, there’s a limit here. You can only deduct up to $10,000 for a second home.
In addition, if you choose to rent this second home out at any point, your income will only be tax-free for the first two weeks (14 days). After this point, rental income is taxable.
Some who are considering a second home may look into a consolidated mortgage, which involves combining your first and second home mortgages into one. This is ideal for those who want to simplify their lives, as you’ll only have to pay one monthly bill instead of two. For more information on this process or any other aspect of the second home mortgage application, please feel free to contact us anytime!
For more on how to go about purchasing a second home, or to learn about any of our mortgage rates or other services we provide to homebuyers, speak to the staff at Primary Residential Mortgage in Fort Myers today.
*PRMI NMLS 3094. PRMI is an Equal Housing Lender. Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. Programs, rates, terms, and conditions are subject to change and are subject to borrower(s) qualification. This is not a commitment to lend. Opinions expressed are solely my own and do not express the views of my employer.