Second home mortgage: Is it possible to buy a holiday home using a bank loan?

Second mortgage: What are the conditions for financing the purchase of a second home?

Having a second home is the dream of many families - whether for holidays, renting, or as a long-term investment. Is it possible to apply for a second home loan? And what do you need to know before moving forward?

Yes, it is possible to have two mortgage loans.

Nothing prevents having more than one housing loan simultaneously. As long as you have the financial capacity to assume the charges, banks can approve a second loan for the purchase of a new house.

However, the risk analysis will be more demanding, as there is already a fixed monthly burden with the first credit.

In what situations does it make sense?

A second home loan can be used for:  

• Buy a vacation home;  

• Investing in a property for rent;  

• Acquire a property for a child, keeping the property in your own name.

• Buy a new home while keeping the current one.

What will the bank analyze?

When requesting a second credit, banks will evaluate carefully:  

• Your effort rate: Sum of credit installments in relation to monthly income. Ideally, it should be below 35%-40%.

• Your financial and professional stability.

• Credit history (no defaults);  

• The value of the property and the down payment;  

• The Loan-to-Value ratio (LTV) - in general, you will have to make a down payment of more than 10% - 20% since it is a non-permanent residence.

Interest rates and conditions  

The second credit will have different conditions from the first.

• Payment deadline can be shorter;  

• Spread may be higher.

• The financed amount tends to be lower (maximum 80% of the purchase or valuation value).

• The required insurances are the same, multi-risk and life insurance.

Having two houses can be an achievable goal - as long as it is planned responsibly.

Read also: Second home loan: How does it work?

Before proceeding with a second home loan, simulate different scenarios with various banks. For this, the credit intermediaries of Poupança no Minuto can help evaluate your financial capacity, gather proposals, and assist in choosing the most suitable one for you! They handle the entire process for you, at no cost. Get in touch and start today: