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Andrew Dehan Andrew Dehan
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Suzanne De Vita Suzanne De Vita
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On Thursday, April 04, 2024, the national average 30-year fixed mortgage APR is 6.95% according to Bankrate's latest survey of the nation's largest mortgage... lenders. Use Bankrate's rate table to compare today's second home APRs.
On this page
- Current second home mortgage rates
- What’s the difference between a second home and investment property?
- How to qualify for a second home mortgage
- Compare mortgage lenders side by side
- Pros and cons of a second home mortgage
- Second home mortgage FAQ
- Additional resources on second home mortgages
How to compare mortgage offers
Comparison-shopping for a mortgage isn’t just smart — it’s crucial to get the most competitive rate and mortgage terms. Even a 0.1 difference in an interest rate can save thousands of dollars over the life of the loan. Bankrate’s mortgage rate table allows you to easily compare personalized rates from our marketplace of trusted lenders. Here is how to compare mortgage offers on Bankrate in 3 easy steps:
- Determine the right type of mortgage: There are a lot of options in home loans, so it’s important to research and decide what type of mortgage might be best for you, given your finances and your short- and long-term goals.
- Gather necessary documentation: In order for lenders to give you the most accurate quote, you will need to provide paperwork once connected with a lender that verifies your income, assets, debts and employment.
- Compare mortgage offers online: Bankrate helps you easily compare mortgage offers by using our mortgage rate table below. Our rate table filters allow you to plug in general information about your finances and location to receive tailored offers. As you weigh offers, be sure to consider APRs, lender fees and closing costs to ensure you’re making accurate comparisons — and maximizing your savings potential.
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Bankrate has helped people make smarter financial decisions for 40+ years. Our mortgage rate tables allow users to easily compare offers from trusted lenders and get personalized quotes in under 2 minutes. While our priority is editorial integrity, these pages may contain references to products from our partners. Here is how we make money.
On This Page
On This Page
- Current second home mortgage rates
- What’s the difference between a second home and investment property?
- How to qualify for a second home mortgage
- Compare mortgage lenders side by side
- Pros and cons of a second home mortgage
- Second home mortgage FAQ
- Additional resources on second home mortgages
Current second home mortgage rates
The rates on mortgages for second homes are higher than those for loans against primary residences because they’re a riskier prospect for lenders. If in financial straits, you’re much more likely to pay the mortgage on the home you live in than the one you vacation in or rent out.
National mortgage rates by loan type
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year Fixed Rate | 6.91% | 6.95% |
| 15-Year Fixed Rate | 6.36% | 6.43% |
| 5-1 ARM | 6.61% | 7.94% |
| 30-Year Fixed Rate FHA | 6.74% | 6.79% |
| 30-Year Fixed Rate VA | 7.09% | 7.13% |
| 30-Year Fixed Rate Jumbo | 7.00% | 7.05% |
Rates as of Thursday, April 04, 2024 at 6:30 AM
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year Fixed Rate | 6.96% | 7.00% |
| 15-Year Fixed Rate | 6.41% | 6.48% |
| 5-1 ARM | 6.42% | 7.76% |
| 30-Year Fixed Rate FHA | 6.89% | 6.94% |
| 30-Year Fixed Rate VA | 7.72% | 7.74% |
| 30-Year Fixed Rate Jumbo | 7.03% | 7.08% |
Rates as of Thursday, April 04, 2024 at 6:30 AM
What’s the difference between a second home and investment property?
The main difference between an investment property and a second home hinges on occupancy: If you personally live in the property for two weeks or less per year, you have a good case for classifying it as an investment, based on IRS guidelines. If you spend more than 14 days in the property each year, it’s a second home.
How to qualify for a second home mortgage
Your second home has to be used as a residence in order to qualify for a second home mortgage — it can’t be an investment or rental property. Investment properties come with stricter mortgage requirements, and are also taxed differently than second homes.
Similar to the mortgage on your primary residence, your credit, income, employment history and other factors need to meet the lender’s requirements. As early in the process as possible, review your credit report to check for errors or ways to improve your score. If you can, work on paying down debt — this can boost your credit and help you qualify for a bigger mortgage.
Here are some of the most common requirements for a second home mortgage:
- Credit score: 660 or higher
- Down payment: 10% or more
- Debt-to-income (DTI) ratio: 45% or less
Depending on where your second home is located, your lender might also require flood insurance.
When you’re ready to shop for a second home mortgage:
- Calculate affordability. Before buying, think about your budget and whether you can afford a second set of maintenance costs, insurance and other expenses.
- Find the best rate. Shop around to find the lowest interest rates. Be sure to compare the lender fees on each loan option.
- Get preapproved for a mortgage. A preapproval will suggest the amount you qualify for, and you’ll need this when you go to make offers on homes.
Lender compare
Compare mortgage lenders side by side
Mortgage rates and fees can vary widely across lenders. To help you find the right one for your needs, use this tool to compare lenders based on a variety of factors. Bankrate has reviewed and partners with these lenders, and the two lenders shown first have the highest combined Bankrate Score and customer ratings. You can use the drop downs to explore beyond these lenders and find the best option for you.
Garden State Home Loans
NMLS: 473163
|
State License: MB-473163
3.6
Rating: 3.6 stars out of 5
Bankrate Score
Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Recent Customer Reviews
Rating: 4.98 stars out of 5
5.0
562reviews
Read full lender review
Homefinity
NMLS: 2289
|
State License: 4965
4.5
Rating: 4.5 stars out of 5
Bankrate Score
Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Recent Customer Reviews
Rating: 4.94 stars out of 5
4.9
1062reviews
Read full lender review
Pros and cons of a second home mortgage
Pros of second home loans
- You can deduct the interest and property taxes. You can deduct the mortgage interest for both your primary residence and second home up to $750,000 total (or $375,000 if married filing separately). This applies only to “qualified” second homes, meaning you don’t rent it out, or you do rent it out but also use it yourself for a certain period of time each year. You can also deduct combined property taxes up to $10,000.
- You can use your primary residence to help pay for it. You can take advantage of the equity in your primary residence to make a down payment on a second home, either through a cash-out refinance or home equity line of credit (HELOC). It might be better to do a cash-out if you know exactly how much money you need, can get a lower interest rate on your first mortgage and don’t plan to pay that first mortgage off anytime soon.
Cons of second home loans
- It costs more. Generally, you can expect to have a higher interest rate on your second home loan compared to the one on your primary residence, so you’ll pay more in interest over time. You might also have a higher rate if you decide to refinance your second home mortgage down the line. Along with that, you’ll need to make a bigger down payment.
- It can be harder to qualify for. Because the second home isn’t your primary residence, you’ll need to meet stricter credit and DTI ratio requirements.
Second home mortgage FAQ
Additional resources on second home mortgages
- How to buy a second home
- Key considerations when buying a second home
- Using home equity to buy a second home
Mortgage rates in other states
- United States
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- Washington DC
- West Virginia
- Wisconsin
- Wyoming
