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Mortgage to buy a second home
Another house to live in the future, as an investment, for the summer holidays, to spend a day at the mountains, etc.
Even though this can be regarded as a long-term savings tool, with a second home comes a great responsibility. Although you will already have experience with this, it is of vital importance to think well about the decision, since some aspects change, such as the mortgage loan limit established by the bank for the mortgage of a second home. However, when you are confident about your decision, have saved enough and chosen the most suitable mortgage loan, a second home will be a great option and even a source of investment.
What do you need to know when buying a second home?
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The cost of a new home. First, the cost of purchasing the home (the cost of the home and notary fees, registration fees, income tax and other taxes; any refurbishment work needed, etc.). Next, the maintenance costs; keep in mind that you will have to pay for the cost of electricity, water, community fees and property tax twice if you already have another home. If you plan on renting it out, some of these expenses will be paid by the tenant, but it is also possible that you might have to cover the cost of any damage or expenses caused by normal use.
You will most probably need a mortgage loan, so you need to analyse the different types, fees and associated expenses. -
In relation to the previous point, the current economic situation. Can you afford it with your current earnings? And, in the long-term? This will depend on your current personal and professional situation. In addition, you need to have savings.
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The purpose and intended use. Will this be a home to spend our holidays in or will this be purchased as an investment? Can you rent it out after buying it? The profitability in each case will be different.
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The zone. This is a key aspect that is conditioned by what the second home will be used for. For example, if it is located in the centre of town or in a residential area; if it is located in an area in which people spend their summer holidays, if it is on the beachfront, etc.
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Distance. If you wish to purchase a home to spend your holidays in, the distance to your second home will be a determining factor: ideally, it should be close enough for a weekend getaway, and far enough to get away and relax ...
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The average price of property. In other words, current and future trends in the price of property. The current trends show that prices increase over time but, as time passes, the future trends will be determined by the context and circumstances of each period.
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Return on investment and appreciation in value of property. In any case, buying a second home will be a profitable decision, especially if you plan on renting it out. In addition, it will appreciation in value over time.
Another important decision: the mortgage loan
The mortgage loan is another factor that requires you to think about well, since there are several types, and you need to choose the correct one. With the fixed-rate mortgage loan, the monthly payment is always the same. Moreover, variable-rate mortgage loans will change every year, according to the market trends and changes. Mixed mortgage loans establish a fixed rate for the first years and a variable rate for the next years.
Discover our range of mortgage loans and find the one that best suits your needs and savings profile. You can also simulate the instalments you would be paying.
Second mortgage loan: Fixed? Variable? Mixed? everything you need to know in less than 1 minute!
Fixed rate, variable rate or mixed rate; it will all depend on your saving profile and your plans and expectations in the medium and long-term. If you want to find out more about mortgages, check this content.
Variable-rate mortgage
- How it works: varies and is revised depending on the market
- Interest Rate: Euribor + spread
- Monthly instalment: variable
- Payment review: every 12 months
Fixed-rate mortgage
- How it works: your monthly payments are the same throughout the whole of your mortgage.
- Interest Rate: fixed
- Monthly instalment: fixed
- No payment reviews
Mixed mortgage
- How it works: it is fixed during the initial years and then variable
- Interest Rate: fixed at the start and then variable
- Monthly instalment: fixed and variable
- Payment review: for the variable part every 12 months
I have made a decision, I wish to request a mortgage loan for a second home
For a bank, a second mortgage loan is a riskier option, so the terms and conditions will not be as good as those of the first mortgage loan; you must also take this into account. Discover Bankinter's mortgage loans and, if needed, ask for our advice.
When it comes to mortgages it is normal to have doubts. Some need to be dispelled quickly.
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