Have you ever dreamed of buying a vacation home? Just imagine how nice it would be to pack up on summer weekends and head to your home away from home, where you can enjoy a change of scenery, a relaxing location, and all the family time you desire.
This doesn’t have to be a fantasy. While you may think of owning a vacation home as a pipe dream, it’s quite achievable when you plan ahead. We’ll explain the advantages of owning a vacation home, how you can make it happen, and what you need to know before you buy.
Whether you love the beach or you prefer to escape to the mountains, you can find countless reasons to invest in a vacation home.
Many people looking to purchase a vacation home already have one mortgage on their primary residence. If you do, too, you may wonder whether you can take out an additional mortgage on a second property. Even if you have an existing mortgage, you can take out another to cover your vacation home. The process for approval is the same; however, some financial institutions may not finance properties out of state, so you’ll need to contact your bank or credit union to learn about any restrictions.
Not everyone chooses to go this route. Some decide to take out a Real Estate Equity Loan, which is another name for a home equity loan. This allows you to borrow based on the equity you’ve built up in your primary residence. You can get a fixed sum delivered to you in a single lump amount, and then make monthly payments on that sum.
The terms on PSECU Real Estate Equity Loans run for five or ten years. We offer fixed rates on these loans, too, so your interest rate does not change for the life of the loan.
Before you try to buy a home, you should know what you can afford. For those who already have one mortgage, adding an additional monthly payment could extend you past the point where it feels comfortable. Remember that you won’t just pay for the home. You also need to factor in the expenses of homeowners’ insurance and property taxes, as well as any applicable homeowners’ association or condo fees.
You should also think about other expenses that may arise related to owning a second home.
Plus, if you plan to count on rental income from a vacation property to pay your mortgage, you may need to make it available during prime vacation time. That means you won’t be able to enjoy a stay there yourself during those periods. For instance, consider beforehand if you’re willing to rent on holidays like Memorial Day, Independence Day, and Labor Day. You’ll also need to arrange for cleaning of the home in between renters.
An additional cost of a vacation home is upkeep during the offseason. For example, when it snows in your rental location, you may still be responsible for removing snow from the sidewalks outside or getting the heavy precipitation off the roof of the home. You’ll need to make caretaking arrangements or be able to get to the home relatively quickly to take care of any necessary responsibilities.
While owning a vacation home is rewarding in so many ways, it’s important to consider both the time and money required to address all of this work.
Pennsylvania offers numerous gorgeous getaways all around the commonwealth. You can find vacation homes across the state, many of them within driving distance of fun family activities, such as beaches, amusement parks, and historical locations.
You may want to choose a waterfront setting, or perhaps you’ve always dreamed of a cabin in the woods. Let your interests dictate where you search for your vacation home. Just a few ideas include the following:
For those buying homes in Pennsylvania, whether they’re vacation properties or primary residences, PSECU offers mortgage services. Become a PSECU member, then learn more about our competitive mortgage rates.
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