This BLOG On Fannie Mae Guidelines On Second Home Loans Was UPDATED And PUBLISHED On May 15th, 2020
Second Home Loans are conventional loans. There are NON-QM and Bank Statement Mortgages on Second Homes are available. Government Loans such as FHA, VA, USDA, are for owner occupant homes only. Home buyers cannot purchase second homes with FHA Loans, VA Loans, and USDA Loans.
- For a homeowner to qualify for second home financing with a conventional loan, they would need to meet Fannie Mae and/or Freddie Mae Guidelines On Second Home Loans
- For second home conventional mortgage loans, the minimum down payment used to be 5% down
- However, that is no longer the case
- New Fannie Mae and Freddie Mac guidelines on down payment for second homes have now changed
- To qualify for a second home mortgages, a home buyer needs a minimum of 10% down payment
In this article, we will discuss and cover Fannie Mae And Freddie Mac Guidelines On Second Home Financing.
The Basics On Second Homes
The mortgage industry is probably the most regulated industry in this country.
- Since 2009, the whole mortgage industry has changed
- Thousands of mortgage companies have gone out of business and thousands of mortgage brokers have left the field due to the new regulations
- The Dodd Frank Act has brought new rules and regulations
Eligibility Requirements On Second Homes
Second homes are still extremely popular.
- Many folks who are renters decide to purchase a home in places like Florida or California for either weekend getaways or to use it as second homes for their families to enjoy
- The 5% minimum down payment requirement for second homes made second home financing affordable to many Americans
- Now, Fannie Mae and Freddie Mac has increased the minimum down payment guidelines for second home financing to 10% of the purchase price
Second Home Loans Versus Investment Home Loans
Another requirement to be classified as a second home is that it needs to be some distance away from the mortgage loan borrower’s main residence.
- If the second home is less than 60 miles away from the mortgage loan borrower’s main residence, it will be considered an investment home
- Mortgage rates on investment homes are higher than those for second homes or vacation homes
Update on Second Home Loans
We now offer Condotel and Non-Warrantable Condo Financing which are portfolio loans with 25% down payment. Condotel and Non-Warrantable Condo Financing are 30 year adjustable rate mortgage portfolio loans.
If you have any questions on second home mortgage loans please contact us at 800-900-8569 or text us for a faster response. Borrowers can also email us at firstname.lastname@example.org.