Just wondering whether or not the interest rate will be determined as a vacation home, second home, or first home since the primary residence is paid off.If the primary residence is fully paid (no mortgage), how is a loan on a second home (vac. home) determined?
All banks have an ';approach'; or policy that is subtly different. As your bank what they would likely offer you as a solution and if you don't appreciate the answer, go to a different bank or finance company and get a second or third opinion.
Generally speaking they'll likely do what ever you'd like done have a property that is fully paid for as collateral on what ever you choose to do.
there are advantages and disadvantages.
Stay the course of paying off mortgages ~ great stuff.If the primary residence is fully paid (no mortgage), how is a loan on a second home (vac. home) determined?
You should look at all your options including mortgaging your primary residency to pay the secondary residency in cash. I think non-primary residency rates might be a bit higher.
Mortgages are case by case. How is your credit?
Most likely you can get a very good rate as long as it is not rental property
A second home will have the same rates and terms as your primary residence
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