How Much Deposit Do I Need for a Second Home?
Homebuyers know that lenders prefer to receive a 20% deposit on approved mortgages. The same is true for first-time and second-home buyers. Lenders seek to mitigate their risk on every home loan issued. The deposit ensures that the homeowner has skin in the game. If their finances take a hit, they will not walk away from the home easily.
Lenders prefer a 20% deposit for a second home loan. However, some drop the requirement to 15%. If the homebuyer does not have the funds saved as a liquid asset, alternative options exist. For example, second-home buyers can apply for a bridging loan. Then, they apply for a new mortgage to finance the second property purchase.
If the second-home buyer owns a property that has built up equity, it’s possible to leverage it as collateral and against the deposit. In 2022, an array of mortgage and property purchase tools exist. As a non-bank lender, Mortgage House provides innovative financial solutions. We equip our loan specialists with tools that help them evaluate applications quickly. Then, they can spend more time finding the best products for most financial situations and goals.
Purchasing a second home provides several benefits. Investors and owner-occupiers benefit from the additional property.
We offer online tools with no strings attached such as our mortgage repayment calculator.
Deposit for a Second Home Conclusion
The deposit for a second home requirement remains similar to the first. Thus, the homebuyer should expect to offer 20% upfront. Finding alternate options do exist. Mortgage House loan specialists can walk second homebuyers through them. Contact our team today.