Secondary home mortgage rates?

Revelate — Mon, 17 Feb 2020 05:51:31 GMT

Seeing some conflicting information via Google so figured would just ask here.

Non-investment property, legit second home (much further than 50 miles away or whatever the minimum distance is), own it already at around 45% LTV so should be in the minimum Fannie bracket for everything.

I'm assuming that it's functionally the same qualification steps as a normal mortgage, but what's the typical additional rate? +0.5% or even 1%? Are there more stringent requirements when it comes to DTI/assets/etc once we move out of primary residence land?

Assuming I get through this new mortgage I'm seriously looking towards refinancing my existing debt down to improve cash flow: namely I'm on a 15 year fixed at just over 1800/month and even at 30 year fixed 4% it nearly cuts it in half not including the closing costs which are a one time event. Also may be refinancing the auto loan too though given I'm still potentially 60 days out from the Houston mortgage closing (new construction) and the refinance would take another 45ish days conservatively, I may just pay the darned thing basically off once I have enough money pooled to close: already reduced my 401K contribution to zero (I'll make it up back half of the year potentially on a much better 401K plan) and decided I have enough money in the market currently anyway so my normal money outlets won't be a thing.

Just getting a little cashflow skittish even if I know not having California withholding chewing up my current paychecks is going to be a large boost as soon as I can claim Texas residency.

Re: Secondary home mortgage rates?

NC_Mtg_Loaner — Tue, 18 Feb 2020 02:55:31 GMT

In my market, a secondary home might be an eighth to a quarter point higher than primary rate loan.

Max LTV = 90%

Re: Secondary home mortgage rates?

Revelate — Tue, 18 Feb 2020 04:58:57 GMT

@NC_Mtg_Loaner wrote:
In my market, a secondary home might be an eighth to a quarter point higher than primary rate loan.

Max LTV = 90%

Oh hrm, may be talking 3.75% or lower then.

Have to do some math but paying a few thousand in closing costs to accelerate cashflow by another ~900/month post-tax probably makes sense. Additional 10K a year goes a long way when you have suddenly non-trivial debt obligations.

Thanks for the response!

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