Whats the difference between purchasing a home as a second home versus a rental property?
The two biggest differences between the two are the loan progams that will be available for financing, and the way the Internal Revenue Service (IRS) will treat the property for tax purposes. A rental property will require investment property financing, which usually carries a higher interest rate than primary residence properties, and you may have to put additional funds down because lenders see investment properties as a slightly riskier loan. You are also obligated to pay taxes on the income you receive from a rental property, whereas a second home will probably not have any rental income.
Related Questions
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