Here is the main consideration when buying a second home. Much of the process is similar to buying a first home; the main difference is deciding how you will finance your second home. The tax implications of owning a second home differ on whether it’s a second home or an income generating property. It’s highly recommended you consult your CPA to understand the tax bill you may face. If you rent your second home for more than 14 days out of the year, the IRS considers it an investment property; in this instance it means you must report rental income.
As you finance, you will then determine the best type of mortgage based on how you plan to use the home. Lenders typically offer different rates and may have different qualification requirements for second homes than they do for investment properties.
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