How do you finance a recreational home?
You have your eye on a recreation home. How do you arrange financing? If you have part of your own money, you can use it and finance the rest of the amount with a loan. Do you not have your own resources? Arrange the financing with a mortgage or take out a loan. A difficult choice? We put the facts side by side so that you can choose the most suitable option that matches your wishes and your financial and personal situation.
A mortgage or loan? The facts at a glance
You can take out a second mortgage for the holiday home. If you have surplus value on your owner-occupied home, it may be possible to use this for financing this second home. Bear in mind that with a second mortgage you are not eligible for interest deduction. You only have this tax benefit with a first home.
Maximum 75% mortgage
Taking out a second mortgage is not a matter of course. The rules regarding mortgage lending are becoming stricter. Banks are cautious and, in the case of a second mortgage, close a maximum of 75% of the value of the second home. You have to finance the remaining part in a different way.
Taking out a mortgage entails extra costs. You have to pay the broker / appraiser and notary and advice and closing costs are charged. There are exceptions to notary fees to be paid: in the case of a (mobile) caravan you are not dealing with a notary. This also applies if you purchase your recreational home from a recreational park. With a loan you never have to deal with these extra costs. In addition, taking out a loan is faster than raising a mortgage.
You partially finance the holiday home if you do not have enough of your own money or if you do not want to invest all your money in the home. Money that you invest in your holiday home is no longer freely withdrawable and disposable, since it is in your “investment”. If you want to keep money freely disposable and withdrawable at hand, it is a good idea to use part of your equity and finance the rest.
Financing with a loan
The maximum amount of the loan amount depends, among other things, on the type of holiday home. Is it a (mobile) caravan, chalet or an apartment? We have a suitable responsible loan with low interest rates from 3.9% for every loan target.
Personal Loan or Revolving Credit
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You can theoretically opt for a Personal Loan or Continuous Credit. A Personal Loan offers security thanks to the fixed interest rate, term and monthly charges. The bank pays you the total loan amount once, so that you can pay for the cottage or chalet. You are debt-free on the end date.
Choosing a Continuous Credit means flexible borrowing. You decide when and how much you withdraw from your loan amount. The interest and duration are variable, the monthly charges are not.
On both the Personal Loan and the Revolving Credit you can repay without penalty during the term. You do not receive a tax benefit with a loan for a recreational home; the interest costs are only deductible for a first home.
In practice, we recommend a Personal Loan for the recreational home loan. We offer favorable conditions with all loans.
Destination second home
Finance a second home as an investment, or do you buy it for your child (ren)? Our credit specialists can think along about asset growth through favorable investments and investments, how you can use the return on rental income in a smart way or how you can help the children get started with their first home. Whatever the purpose for your second home, we think along with you and ensure that you take out the most suitable loan. Even if you only need a loan for a part of the purchase amount of the holiday home, you can contact us.
You can use our quotation form to request the loan of your choice. You enter your details and submit the application. We will then contact you to complete the application so that we can send you the most suitable and affordable offer. Borrowing is tailor-made, so we always offer you a loan that matches your situation.