3 Questions to Ask before You Buy a Vacation Home

If you want to buy a vacation home, there are several different factors to consider first. Many people have mistakenly made purchases of vacation homes because they did not ask the right questions first. Here are a few questions that you might want to ask before buying a vacation home.

1. Is the House in the Right Location?

As they say in the real estate game, location is the most important factor. You need to make sure that you have chosen a location that you like for a vacation home. When you purchase a vacation home, most of the time this means that you will be spending the majority of your vacation time at this house. Therefore, you need to make sure that this is a location that you could potentially visit every year and enjoy yourself. This is going to be a big financial investment, and you need to make sure that it is worth your while. You should also consider whether you are in a popular travel destination. If you ever try to resell the property, being in a hot travel location can help increase the value and sell the property quickly.

2. Can I Afford This?

Another very important question that you need to ask yourself is whether you can afford this purchase. Many people dream of owning a vacation home, but most people cannot afford it. You need to sit down and look at your finances and make sure that they can support another mortgage payment. If you are questioning whether you can afford it or not, you might want to postpone the purchase. There will always be unexpected expenses associated with this type of purchase. Make sure that you make enough money to cover mortgage payments, travel expenses to the property and the extra taxes and maintenance.

3. Can I Qualify for a Loan?

If you do not have enough cash to buy the property, you will have to secure a mortgage to do so. Many people do not realize how difficult it is to get a mortgage for a vacation home. Vacation home loans have much stricter standards when it comes to getting approved. Therefore, you need to make sure that your credit file is in order before applying. You should also try to pay down the balances on any credit cards or other credit accounts. In most cases, you will also want to have some savings built up if you want to get approved. Most lenders are going to require that you have enough money in savings to cover both of your mortgage payments for 3 to 6 months. This can be a substantial amount of money that eliminates many people who want vacation homes. Once you feel good about your chances, talk to a loan specialist and apply to be preapproved for a loan.