How does getting a vacation home work?

Published on March 29, 2023 under Tips

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Are you considering getting a vacation home? Owning a vacation home can be a great investment and provide a place to relax and enjoy the company of family and friends. Before making the decision to purchase a vacation home, it is important to do your research and understand the differences between a vacation home and a primary residence. In this blog post, we'll discuss some considerations before getting a vacation home, from researching the ideal location to understanding the maintenance requirements. No matter what type of property you're looking for, First Savings Mortgage is here to help make the process easier.

Buying a Vacation Home vs. a Primary Residence

When deciding to purchase a vacation home, it's important to understand the differences. First and foremost, a vacation home is generally intended for personal use only, meaning that it cannot be used as a rental property or for any other type of business. Additionally, since a vacation home is typically purchased in an area that you don't live in or work in, there are additional considerations when making the decision to purchase one.

For starters, when buying a vacation home, you'll want to determine what type of house is best suited for your needs. Does it need to accommodate a large family? Or maybe you prefer something with a bit more privacy? Keep in mind that some states may have different regulations on how big of a house you can build/buy depending on the size of the land it is being built on.

Another important factor to consider when purchasing a vacation home is the financing. You may need to make a down payment that is larger than the one required for a primary residence. You may also need to obtain special financing from a lender that offers vacation home loans. Working with First Savings Mortgage can help you find the best loan options for your needs.

Finally, remember that you will need to pay annual taxes on the vacation home, just like you would for a primary residence.

Location, Location, Location

When considering a vacation home, location is critical. Here are some key things to consider when looking for your ideal location:

  1. Proximity to attractions: If you're buying a vacation home near a beach or ski resort, think about how close it is to the local attractions and activities. A short drive may be worth the extra savings, depending on your budget and financial situation
  2. Quality of life: Consider the local school district and safety of the neighborhood for your family and guests
  3. Local laws: Make sure you familiarize yourself with the local zoning laws and homeowner's association rules. You'll want to make sure you can do what you want with the property without running afoul of regulations
  4. Resale value: Keep in mind that you may eventually decide to sell the property, so it's important to consider the potential resale value when selecting a location

Take your time when researching locations for your vacation home. Speak with local real estate agents, as they can help provide you with insights into the market and current listings. Spend time in different areas and assess the best location for you.

Maintenance and Upkeep

Keeping your vacation home in top shape is essential not only to its functionality, but also its value. If you are not local to the vacation home, you may need to hire a property manager to handle regular maintenance and upkeep. This could include things like lawn care, plumbing, and other upkeep items that require regular attention. You may also need to factor in seasonal considerations such as snow removal, cleaning, or even an HVAC service plan.

No matter who is handling the maintenance and upkeep of your vacation home, it's important to make sure you have a good understanding of how much everything will cost in addition to how often each type of maintenance or repair should be completed so that you can properly budget.

Another consideration is insurance on your vacation home. Some policies are designed specifically for vacation homes and may offer additional coverage options that may not be available with a traditional homeowner's policy. Be sure to speak with an insurance agent to determine what kind of coverage you need for your vacation home.

By taking the time to properly research maintenance and upkeep costs and responsibilities associated with owning a vacation home, you can make an informed decision about whether it is right for you and prepare yourself financially and mentally for the journey ahead.

Other Considerations

  • Tax Implications: Owning a vacation home could lead to significant tax implications, so it is important to understand the local rules and regulations regarding taxes when buying a vacation home
  • Insurance: Make sure you have adequate insurance coverage for your vacation home. There may be some additional insurance needs due to its location or proximity to the ocean or other natural elements
  • Utility Costs: Be prepared to pay utility costs such as electricity, gas, water, and more that may be more expensive due to the location of the vacation home
  • Utilities and Maintenance: Make sure you have access to all necessary utilities such as electricity and water. Consider who will be responsible for maintenance of the property and its amenities
  • Seasonal Considerations: Consider seasonal fluctuations and natural disasters that may occur in the area. It is important to take into account potential risks before purchasing a vacation home


Now that you have a better understanding of the issues to consider when owning a second home, it's time to weigh your options. Consider the important factors such as location, budget, and maintenance in addition to reviewing total investment costs such as financing options, estimated closing costs, etc. Educate yourself on the process, create a realistic budget, and find the right lender to guide you. With some careful planning, you can start enjoying your vacation home in no time.

Work with experienced mortgage lenders from First Savings Mortgage to ensure you get the best deal possible for your new vacation home.

Contact an Expert Loan Officer