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Is Buying A Second Home Different Than A First Mortgage?

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The process for buying your second home is very similar to purchasing a first home. But, also a little different.

All Loans Need:

  1. 2 recent years of W2’s / 1099’s

  2. Last 30 Days Pay-stubs

  3. Last 2 Months Bank Statements

  4. Photo ID

Second Home vs Investment Property

Before you buy, decide if you want a vacation house or a rental property. There are different fees and rates available depending on which you choose. Which one is right for you? This really does depend on your goals and your long-term plan with this second house. Are you wanting to be a landlord? Do you want a house that is all yours that you can escape to on a whim? Maybe you want to use the property as a short-term rental when you are not vacationing in the home. Really narrowing down and being clear on this is essential.

So, How Is The Process Different?

To start: Vacation Home = Second Home. Investment Property = Rental Property. A second home requires a minimum of 10% down and the property needs to be at least 50 miles from your primary residence. An investment property requires a minimum 20% down. Other than those 2 big distinctions, the rest is the same!

Pro’s and Con’s of Owning a Second Property


  1. Home Away from Home. Having a place that you can use when you need to escape from your current adulting struggles, is a perfect reason to purchase a second home.

  2. Set-Up for Retirement. Not only will you have this second home for fun, but it is also a great way to build up wealth. As this home appreciates in value you can sale and use the proceeds towards your retirement fund.

  3. Instant Income. Why not turn your second home into a nice rental property? Use that instant income to help pay off the home. Winner winner chicken dinner.

  4. Easy for a Quick or Last-Minute Getaway. Have a favorite vacation spot? Why not buy? Not having to pay hotel fees or rental fees can save you money over time.

  5. Fixer Upper. If you have a little Joanna Gaines in you (who doesn’t, honestly?) by having a second property a fix up and flip is a great option. Let your imagination run wild on a new project.


  1. Two House Payments. When you have two homes, with two loans, comes with two payments. Double and triple check your budget to insure this makes sense for you.

  2. Two Houses to Keep Up with Updates. If you own two homes, you will also need to take care of and update for two. Updates increase your property’s value, so keep that in mind.

  3. Two Emergency Funds for Two Homes. All the saving that you put aside for emergencies for your current home you will need to double it. Think, if one water heater goes out the second is bound to follow.

  4. Higher Interest Rates. In general, your second home is subject to higher interest rate cost regardless if you have a mortgage on your first home or not.

  5. Potential Bad Tenants. Interviewing, choosing, cleaning, and negotiating with tenants can be exhausting. You are giving up your freedom inside the home to someone else and who knows how they will treat it.

If buying a second home is something you want to make a reality, please reach out to The Ben Lemon Team to schedule a quick 10-minute appointment to see what we can make a reality for you!


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