Buying Your Second Home

It is easy to get caught up in the fantasy of owning a seaside cottage or a mountain-top abode, but don't forget to take into account the responsibilities of an additional property.

Financing a second home can be tricky because lenders will typically assign a greater level of risk to your mortgage loan. In turn, you'll need to provide a larger down payment and incur a higher rate of interest than you did for your primary residence. To help alleviate the costs, you can use a home equity loan because they generally have a lower interest rate than standard mortgages. I can help guide you through this process before you make any financing decisions.

Taxes with a second home can be confusing, especially if you are renting out your property during the year. According to the National Association of Tax Professionals®, if you rent your home for 15 days or less, you are not required to report your earnings. However, if it's rented out for more than 15 days, you're required to file it as additional income. Remember you may be able to deduct the cost of repairs and maintenance that you put into your home. Always be aware of restrictions related to renting out your second home. For example, Hide-A-Way Hills Club requires all leases to be for at least 31 days in duration.

The location of your second home should depend on your and your family's individual needs and wants. Don't just check out the house, but also look around the neighborhood for the closest shopping and gas stations, and if you have small children, make sure the neighborhood is kid-friendly. If a secluded lake house is what you have in mind, that's great, but remember you don't want the seclusion to lead to inconvenience. The more convenient your second home, the more use you will get out of your investment. Also, consider whether or not you'll be renting out your home. If so, choose a destination popular for a wide variety of people.

Since you will not live in your second home year-round, it may be vulnerable to crime. The increased risk of crimes committed against second home owners is why Hide-A-Way Hills and its Gated Security is a HAH Member favorite.

Maintenance is also important for security purposes and for the health of your home. Consider hiring someone to cut the lawn, or rake the leaves when you're not at your home.

Buying a second home can be an exciting, yet daunting, venture that requires a fair amount of your time and money. But whatever you choose, mountain-top condo, beach-front villa, cozy suburban ranch, or a Hide-A-Way Hills cabin, a second home can be a great getaway and an even better investment.

Contact me to learn more about Hide-A-Way Hills resort property.

Source: Real Living July Customer Newsletter