Are you considering a second home? If so, then you are doing to want to carefully calculated this decision and work with professionals that you can trust. The first thing you need to do when you are looking into the possibility of a second home is to decide whether or not a second home makes financial sense.
A second piece of property can be an excellent investment, but only at the right time in the right place when your finances are in the right position. Second homes cost a lot to maintain, and many homeowners will admit that their purchase ended up costing more than they ever imagined.
That is why it is important for individuals to tally up all of their expenses and factor in extra costs based on the fact that you won't be there every day. You may need to hire a management service to clean the home and you will probably need to pay for hazard insurance. You can discuss all of these excess costs with a real estate attorney if you are concerned.
When considering a second home, make sure to buy in a location that is desirable. If you plan to rent, then make sure your home is in a great vacation destination where renting is popular. You will want to rely on market research and your own personal preferences as you work through your case. If you are eventually planning to live in the house, look into factors like strength of the local economy, trends in house resale values, convenience, property tax rates, and the quality of local schools and medical care.
You will also want to consider whether you want a condo, townhouse, co-op or a single family home. Oftentimes condos, townhomes and co-ops require less maintenance but you'll have to pay for homeowner's association dues or special assessments on the property.
It is also important to look at the tax implications of purchasing a second home. You will want to consider the costs of property taxes in the area that you are thinking of purchasing and will also need to factor in the income tax if you choose to rent your home. Taxes are a burden but they can be reduced with careful planning.
You will also want to come up with a down payment and will also be able to provide long-term finances. The higher your down payment, the lower your loan will be. Your down payment will need to be at least 20% of the payment price. You may need to use equity in your primary home or borrow against a life insurance policy to get the money. You can also refinance your car to come up with the cash. Most buyers will need a home loan to cover party of the financing on a second house. You will want to review options and payment schedules to find a mortgage that works best for you.
If you don't want to borrow from a bank or mortgage, you can also consider borrowing from family, friends, parents or siblings. You can also purchase a home with friends or family, and start a shared ownership. You will need to be sure that you can co-own with the person that you are considering working with and that you can fully trust that individual. Co-owning can also cause contention when the owners pass away, leaving the home to the other owners. If you are still interested in buying a second home, don't hesitate to get assistance from a trusted attorney today. Use our directory to find a real estate attorney nearest you!