Imagine a summer filled with beautiful sunsets, no television, sandy floors and happy, tired children. A vacation home can provide families with a place to re-charge, build memories and enjoy life’s simple pleasures. It’s a timeless summer experience. If you’re considering purchasing a vacation home, you’ll be happy to know that there are many mortgage options available for you. However, it’s important to carefully review the financing options that are available. Here are a few common questions and answers about mortgages and selecting a vacation home. Q: What are the first steps? How do I get started? A: Contact your mortgage lender about pre-qualification. This process allows you to carefully review your personal budget and determine what expenses you can afford. These expenses include down payment and closing costs as well as improvement projects for your new home. Understanding your credit history is also an important first step to home ownership. Mortgage lenders will review a copy of your credit history to ensure you have a good track record of paying your bills on time and have managed your debt responsibly. Before you meet with a mortgage lender, you should review a copy of your credit report so that you can correct any errors that you may discover. Q: How can I obtain a copy of my credit report? A: You can request a free copy of your credit report each year by contacting: www.AnnualCreditReport.com P.O. Box 105281 Atlanta, GA 30348-5281 877-322-8228 Plus, with the rising threat of identity theft, a regular review of your credit history is a good way of protecting yourself — and your credit history — from the threat of identity theft. Q: Do you have a recommendation about choosing a location? A: As with any real estate, location matters more than any other single factor. The best vacation properties offer something unique such as an ocean view, a mountain vista or a dock on a lake. For maximum appeal to potential renters or future buyers, look for a place within three hours’ drive of a major metropolitan area. Longer distances or difficult roads make weekend trips more complicated and can limit your market. Q: How does a down payment work with a vacation home? A: A Kiplinger’s article reports that vacation-home buyers sometimes make down payments of 20 percent to 50 percent. Some even pay cash if they’re purchasing a less expensive cabin or condo. Many use a home-equity credit line drawn on their primary residence for their down payment. Q: What are fixed rate mortgages? A: If you prefer a monthly payment (principal and interest) to stay the same every month throughout the term of your loan, then a fixed rate mortgage may be the best solution for you. Fixed rate mortgages are ideal if you are a homebuyer who plans to stay in your home for a long period of time, or if you expect mortgage rates to rise. Fixed rate loans come in all sizes and terms. Keep in mind, the longer the term of the loan, the lower the monthly payment. Q: What are little or no money down mortgages? A: Financial institutions have many plans in place to assist first-time homebuyers secure their first home purchase. If your savings does not allow for a substantial down payment, you should discuss with your mortgage lender the availability of zero down payment or small down payment mortgages. Q: I am planning to build my dream vacation home. Is there a mortgage for me? A: Construction and vacant land loans are available from lenders for homebuyers who are building their dream home. Purchasing a home is the largest investment. By working with a trusted financial institution to secure your mortgage, you will ensure that the process goes smoothly and your financial interests are understood. Q: Before I make the final decision, what steps should I take? A: Before obtaining a vacation home mortgage, you should carefully study your mortgage options and determine how much you can afford. Carefully considering your budget and the maintenance expenses will ensure that you get the keys to the vacation home of your dreams.