Real estate provides property owners with numerous benefits that include everything from equity growth and appreciation to tax deductions and more. Many people have decided to maximize the benefits of home ownership by purchasing a second home, and this may provide you with the ability to enjoy the financial benefits as well as to have a great place to vacation with your family. Some may even purchase a second home with the intention of using it as their primary residence in retirement. While there are great mortgage options available to you through MortgageDepot for the purchase of your second home, there are now also competitive terms available for home equity loans and lines of credit on second home properties.
Loan Terms for Second Home Equity Lines of Credit
A home equity line of credit on second home properties can be applied for when you purchase the home or when you are refinancing. The purchase loan option places the equity loan in second position behind your first lien, and it provides you with up to 65 percent combined loan-to-value. The maximum loan amount permitted is $250,000. With a refinance loan, the HELOC will take the first lien position, and the same limits on the loan amount and combined loan-to-value will apply. Eligible property types include single family homes as well as condos, but multi-unit residential properties are not eligible.
How to Use the Funds
There are no limits with regards to how you can use the funds from your HELOC loan on your second home. Some will use these funds to pay off debts or to pay for a nice vacation. Others may use the funds to fix up their first or second home to buy furniture or even to put the kids through school. The amount of equity available in some second homes can be considerable, and the HELOC loan on second homes provides you with a great opportunity to tap into the equity so that it can be used for beneficial purposes.
Whether you are thinking about purchasing a second home or you need to refinance your second home to pull equity out of it, MortgageDepot can assist you with your needs. We strive to provide each client with great lending terms and to structure a loan that meets unique needs. Regardless of your current plans, you can trust our team at MortgageDepot to help you achieve your goals.