Found 1 blog entry tagged as Can You Afford A Vacation Home?.

Once you have a clear understanding of why to buy a vacation home, the next step is understanding the cost—whether you can afford it.

Budgeting for a vacation home is different than your primary residence, in part because mortgage lenders and the IRS will treat your purchase differently based on whether they categorize it as a second home or an investment property.

Mortgage lenders and the IRS look at different factors to categorize your home (and may define them differently), but generally speaking, an investment property is rented out to generate additional income while a second home is for your own personal use. Taking out a mortgage may be easier for a second home than an investment property, but there are trade-offs when it comes to how you…

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