3 Signs You’re Ready to Buy a Vacation Home

Buying Vacation Home

Has buying a vacation home been on your to-do list for a while? It’s a significant investment, but it can have a big impact on your life and how you spend your time. Not only can it bring in extra income, but it gives you and your family a built-in vacation destination you can always count on. But are you ready to take the plunge? Here are three signs you’re ready to buy a vacation home.

Sign #1: You Can Afford Another Mortgage

Being financially ready is the number one sign you’re ready for a vacation home. What does this mean? It means:

  • Your credit score is at least 680
  • You have emergency savings
  • You have a down payment for the vacation home of at least 35%
  • Payments won’t take away from your retirement investments
  • You’ve crunched the numbers on the ROI, and they’re positive

Sign #2: You Understand the Market

Every real estate market is different. If you’ve done the research and understand the market in the location where you want to purchase a vacation home, you might be ready. Knowing the average price of homes and matching those up with your budget is critical.

Sign #3: You Have a Handle on the Numbers

A mortgage isn’t the only cost associated with a vacation home. You need to consider utilities, water, maintenance, upkeep, insurance, and, potentially, property management. If you use the home as a rental property when you aren’t there, you could use it as an additional income stream, as long as you are still comfortable with the cost of owning the home even if you don’t find any renters at all.

A vacation home is a dream for many people, but you have to be sure you’re ready. The team at Midland Mortgage Corporation can help you determine if it’s the right investment for you and your family. Contact us today for more information.

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