Is it your dream to own a second home in an exotic location? Or to buy in an area where, though you are not yet ready to retire, want to live someday? Maybe you want a smaller home where you and your family can vacation or a place where you can go to rest.

The good news for investors is that there are more choices available and a growing number of desperate sellers. Did you know that in 2006, 10% of second home purchases were foreclosure or trustee sales according to NAR.

The key to purchasing a second home in this market is patience and preparation, especially if you are applying for a second home loan. You may be looking at larger down payments on second home properties compared to the past, because lenders are tightening their belts due to record high delinquency rates. A good estimate is a 25% down payment and a credit score of at least 660, and you should fully disclose your income and savings to facilitate the loan process.

Keep in mind, that unlike a true investment property where you are looking for cash flow, income, and tax benefits, this is another personal residence, so take your time and buy right!

This entry was posted on Wednesday, August 8th, 2007 at 3:00 am and is filed under Investing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.