When you and your loved ones need a quiet place to get away, a hotel or relative’s house pales in comparison to a private vacation home. When you’re not using the property, you can rent it out and earn income from tenants that also need a vacation. However, before you contact a mortgage lender, you should take some steps to ensure the purchase is successful and rewarding. Below are a few strategies to help you prepare.

What Should You Do When Buying a Vacation Home?

1. Prioritize the Location

If you’re using the vacation home for your friends and family, you should choose a property in a destination that everyone enjoys. Whether you prefer exciting hikes or relaxing afternoons by the beach, your vacation home should be close to these attractions. This ensures that you have easy access whenever you want a fun experience. Also, if you plan to rent the property, you can list these nearby attractions to entice vacationers.

2. Rent It First

While you may already know and love the area around the potential property, you should get to know the house itself. Before placing an offer, find out if the space is available for rent so that you can have a test run.

If it is, spend a week there and use all of the appliances, cook in the kitchen, and test the HVAC system. This ensures you can identify any potential problems and measure how comfortable the property is.

3. Budget Carefully

If you’re planning on renting out the property, you might assume you can give that money to your mortgage lender—and therefore get a larger or more valuable property. However, remember that you might not find tenants for every week or season.

Plus, any money that you make on this property is subject to income taxes. Some states also impose higher property taxes for secondary homes. Therefore, you should have enough normal income to afford mortgage payments, taxes, and maintenance costs comfortably. Then, consider any income you make from renting a bonus.

If you’re hoping to make a worthwhile investment out of a vacation home, turn to Fairway Independent Mortgage Corp. - The Sharon Thompson Team. This respected mortgage lender is based in Foley, AL, where she helps families and investors find their ideal vacation properties. Whether you’re interested in a condo or cottage, Sharon and her team will provide valuable guidance. Visit them online for more information about their services. Call (251) 298-5304 to schedule a consultation with this mortgage lender.