Fannie Mae Second Home Guidelines
2016 Fannie Mae Second Home Guidelines Update
2016 Fannie Mae Second Home Guidelines require that the second home buyer put at least 10% down payment on a home purchase. Second home financing are not permitted with FHA Loans, USDA Loans, and VA Loans. Government loans are for owner occupant primary residences only. Fannie Mae and Freddie Mac are the two mortgage giants that sets the rules and mortgage lending guidelines for conventional loans. Conventional Loans does allow for second home financing as well as investment home financing. The differences between second home financing and investment home financing is that with second home loans, the mortgage rates are much lower than investment home financing and the down payment requirements are significantly lower than second home financing. Second home financing requires 10% down payment and investment home financing on a single family home requires 15% down payment. Mortgage rates on investment home financing is about 0.50% higher than second home financing. All conventional mortgage loan programs require that the mortgage borrower have at least a 620 FICO Credit Score and must meet all conventional mortgage lending guidelines.
Fannie Mae Second Home Guidelines: Second Home Financing Requirements
Just meeting conventional mortgage lending guidelines and having the 10% down payment on a home purchase does not guarantee that a second home buyer can qualify for a second home mortgage loan. Fannie Mae and Freddie Mac have specific rules and requirements with second home financing requirements. The second home purchase needs to be at least 100 miles from the primary home of the second home buyer. A second home purchase that is just a few miles away cannot qualify for second home financing and can only qualify for an investment home financing. Again, most second home buyers will greatly benefit from the rates and terms and the minimum down payment requirements of second home mortgage loans than investment home mortgage loans.
Second Home Purchases Under 100 Miles From Primary Home
Second home buyers can qualify for second home financing that is closer than 100 miles from their primary homes if and only if the second home purchase is a waterfront property or is located in a resort. If the a second home buyer purchases a second home that is nearby his primary home which is similar in size and similar type of neighborhood, then it will definitely not qualify for second home financing. However, if the second home purchase is a beachfront home or is in a resort area like Disney World in Orlando, Florida, and the second home purchase is nearby the primary residence, then this type of property will qualify for a second home purchase.
If you are in need of second home financing, please contact me at 262-716-8151 or email me at email@example.com. We are available 7 days a week, evenings, weekends, and holidays to answer any of your questions.