#2ndhomes

Demand for Vacation Homes Surges. Mortgage applications for second homes jumped 84% year over year in January. Are you ready to buy a vacation home in Southwest Florida? Let's connect - 239-370-0892.

Having a second home is a luxury which not everyone can afford; in fact the privilege of a second home is reserved for the wealthy or at least those earning a decent wage. A second home is usually in the countryside or resort city where the home owners can not only come to enjoy holidays but also rent out the property the rest of the year to make a small additional income. The extremely wealthy buy a second (third or fourth home) and leave it empty for most of the year. Only coming to use it when they want to go on vacation. Other second home buyers reserve a couple of week for themselves during the year and rent out the property to tourists the rest of the time. Buying a second home is not only intended for present-day use and present-day rental profits but also as a long term investment. Everyone wants to leave their children a small nest-egg and a second home can be just that. Average wage earning people can inherit a second home and then just keep it for sentimental reasons.

And more changes to come….. Genworth…

At the beginning of May, CMHC advised that they were making changes to their product line effective for May 30, 2014, the changes were talked about in our previous blog B21 & CMHC Rule Changes

Shortly after that Genworth reviewed their books and they announced the following:

Effective May 30, 2014, the maximum number of units allowable under the Vacation/Secondary Home Program will be reduced from 2 units to 1 unit.

Upon review of the current Business for Self Program, they will not make any changes to their product line.

Current guidelines for Genworth’s Business for Self program state the following:

The income reported by the borrower must be reasonable based on the industry, length of operation and type of business

Strong credit profile with minimum 2 trade lines with at least two (2) years history

No mortgage, installment or revolving credit delinquencies appearing on the credit bureau in the past 12 months

No reported defaults on residential mortgages for the past 7 years

No previous bankruptcy

Minimum 5% down payment from the borrowers own savings. The remainder may be gifted from an immediate family member. Borrowed down payments are not permitted.

Borrowers with commission income are ineligible

Lender to ensure borrower(s) have no tax arrears

All applicants used to qualify must occupy the property (If two unit property, one unit must be owner occupied)

Questions about your mortgage options and Business for Self?