Long Range Mountain View in North Georgia

Now is probably the best time in many years to find a relative bargain on a mountain property! Prices on cabins, lots and land have come down from their highs of 2005. Finding the best deal involves research, patience, and a good real estate agent. The mortgage market is tightening and buyers must have a solid knowledge of their finances, credit rating and ability to obtain a loan. Getting prequalified by your lender is more important than ever and will help you negotiate the best deal with the seller.

  It is important to think about what a second home purchase will do to your overall financial picture. Investing in real estate has been an important strategy for building wealth for many people over the years. Yet it may not be for everyone. You should determine the impact on your long-term financial goals.

Many lenders now require buyers to put down at least 20 percent on a second home or you will have to pay for private mortgage insurance (PMI). Your primary home lender may not want to tackle a vacation home mortgage, often our local banks may be a better option. You may be able to tap into the equity of your existing home for some or all of your down payment.

River Living in North Georgia

Renting out your cabin is a good way to cover some of the cost, but lenders often charge a higher interest rate and will look at projected vacancy rates to determine if you qualify for the loan. Insurance costs for a short term vacation rental will be higher than a normal home owner's policy. Plus, you have to pay the rental management company a management fee sometimes as high as 35%.

On most vacation homes you can write off your interest payments but not much else. Should you decide to put your vacation home in the rental program you may gain more favorable tax write offs. Seek professional tax advice to determine if renting your vacation home makes sense for you. But don't buy a vacation home for tax reasons alone. If your dream mountain cabin fits into your financial plan and life style and you've done your research, it may be the best time in years to buy.

More Buyers Info on this Site

Please feel free to re-publish this article on your website, provided that the above resource box is included at the bottom of the article and that all links within the box remain active.