Do you live up North and want to purchase a second home down in the Sunshine State? Think you need to save some more money before pulling the trigger? Well, do we have some good news for you!

There’s a common myth that we hear all the time that you need to put 20% down to purchase a second home. That couldn’t be further from the truth. Yes, some lenders want 20% down, but not all lenders and loan products require 20%.  Chissell Mortgage Group works with 100s of lenders and mortgage products to match the best terms to your situation. Options mean better rates and cheaper fees for you. We even have lenders that will go 10% down on a second home. This way, you can keep more of that cash in your pocket!

Now, a low down payment for a second home wasn’t always the case. Lenders like loans when the house is financed with a lower loan to value ratio. The more skin you have in the game, the less likely you will default on your home. For example, if you had a financial issue, would you let go of your house or that second home on the beach? Lenders understand that you will walk away from a second home before you stop payment on your primary residency. To protect their investment, lenders ask for a larger down payment than they would on a primary residence purchase (typically 3-5% down). In general, lenders want to see at least a 90% loan to value ratio on a second home.

Now you may be asking, what is loan-to-value? Loan to value is a ratio of your mortgage amount divided by your appraised property value. For example, if you purchase a home with an appraised value of $100,000 and make a 10,000 dollar down payment, you would be borrowing $90,000. Your loan to value ratio is $90,000/$100,000 or 90%.

Some lenders still require an 80% loan to value ratio. But we have partners who accept 90% LTV for second homes. This is great news! With help from our team, you can keep more money in your pocket and can enjoy your life instead of stashing money away.

If you are interested in learning more about these changes or have any questions regarding financing a second home, please contact Chissell Mortgage Group today at (727) 376-6900.

NMLS ID: 327290; NMLS ID: 2062741

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