It's exciting to purchase a second home. But, it can be difficult for many to afford to do so. After all, making a second home purchase typically requires a significant up-front cash investment. But, it doesn't have to. You may be able to use the equity you've built up in your primary residence to cover the initial cost of your second home.And the average American homeowner has quite a bit of equity - about $299,000 worth on average.
Step #2: Determine how much home equity you need to tap intoIn order to determine how much home equity you'll need for your purchase, calculate reasonable down payment and closing cost expectations based on the budget you came to. Keep in mind that a typical down payment is around 20% of the cost of the home and closing costs can be as high as 6% of the cost of the home.So, say your budget for your second home is $300,000.
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Source: CBSNews - 🏆 87. / 68 Read more »