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What’s a barndominium?

A Barndominium a trendy new type of home that’s gaining popularity. They’re usually defined as an energy-efficient low maintenance metal building you can live in. Think of a warehouse or metal barn with the inside transformed into living quarters. That’s a barndominium. Sometimes they have an attached shop, horse stable, or garage. Sometimes not. The exterior gives homeowners a sleek farmhouse look while the interior can be any style possible.

People love the barndominium because they offer a lot of advantages over traditional stick-built homes:

  • Cheaper and quicker to build
  • Open concept floor plans
  • Energy-efficient metal roof
  • Low-maintenance metal exterior
  • High vaulted ceilings
  • Option for an attached shop

How much does a barndominium cost?
Like anything real-estate related, costs vary based on location and material costs. However, for a rough comparison, a standard house is between $100 to $200 a square foot and luxury and custom homes ran closer to $200 to $500 a square foot to build in the United States in 2020.

Barndominiums “shells” – the exterior walls and roof – are significantly less expensive than those of stick-built houses. Often they’re available as kits which are constructed upon a rectangular concrete slab. Costs range from $70 to $95 a square foot for a more DIY builds and more for ones built by a licensed builder.

How to finance construction for one
There are two ways to build a barndominium – and whether you’ll get financing depends on how you build it.

Option one is to hire a builder to assemble and complete your barndominium. To finance this, you’ll need a short-term construction loan financed through most home loan lenders. Once your home is built (or if you buy an already built one) you’ll need to apply for a traditional mortgage.

Option two is to built it yourself. Most home lenders won’t finance DIY construction. However, some companies that manufacture barndominium shells will offer their own financing. These shells contain the frame, exterior doors, windows, and roof. Beyond that, you will have to finance the additional items needed to complete your home such as electricity, plumbing, walls, flooring, insulation, etc.

Regardless of how you finance your build, be sure to check your land’s zoning and covenant requirements. It’s fairly common for subdivisions to have restrictions on sheds, garages, or other metal structures (which might include your barndominium). And make sure your barndominium will fit on your lot too. Barndominiums are typically larger than other structures, so you’ll want to double-check your home won’t be larger than allowed and will fit on the land you selected.

Do barndominiums hold their value?
So far, those that have sold recently seem to keep their value. They’re growing more popular across the U.S., and you can even find them listed under their own filter on Zillow. Beware, though, that one of the things that makes them appealing is their distinctive design. But it also may make them harder to sell since they’re too unconventional.

When you’re ready to crunch the numbers to see whether a barndominium would be a better option than a stick-built home, contact your local Man Mortgage home lender. They can help you decide whether you’d qualify for a construction loan or if it might be a wiser choice to get a stick-built home.

What Is Mortgage Insurance?

Mortgage insurance is an insurance policy that benefits the lender in the case a borrower defaults, dies, or is otherwise unable to meet the obligations of their loan. If that should happen, the insurance company would pay the lender a portion of the principal balance of the loan. The insurance policy is paid for by the borrower and they are still required to pay back their loan if they should default. The biggest benefit of mortgage insurance for a borrower is it allows the lender to extend credit to those they otherwise would not due to the size of the borrower’s down payment.

Where Do Mortgage Insurance Payments Go?
Your monthly payments are sent to an insurer that will pay a portion of your remaining loan balance to your lender in the event you default on your home loan.

If You Default, Does Mortgage Insurance Pay Off Your Loan Balance For You?
No. If you fail to pay back your home loan according to your initial arrangements, most lenders will allow a grace period of around 120 days to help you catch up. After that period, because you failed to pay back your mortgage loan, your lender has the right to sell your home to recoup the debt. This is called foreclosure. Your lender will keep the proceeds from the home sale as well as a payout from PMI. If there is still a remaining balance on your loan, you will be responsible for repaying it.

Many home loans have mortgage insurance, but it works a little differently for each one.

PMI For Conventional Home Loans
Conventional home loans are offered to anyone so long as they, and the real estate they are securing a loan for, meet the minimum requirements of the lender. Down payment can be as low as 3%. Your lender will likely require you to pay private mortgage insurance (PMI) for down payments of less than 20%. PMI can be cancelled once you reach 20% equity in your home and the lender will cancel it automatically once you have 22% equity.

Calculate your PMI payments.

MIP for FHA Home Loans
Federal Housing Administration (FHA) loans feature down payments as low as 3.5% and easier credit qualifications than conventional home loans. Regardless of your down payment amount, if you have an FHA loan you will have to pay both an upfront and annual MIP. The upfront premium is 1.75% of your loan amount, and the annual premium is between 0.45% to 1.05% of the average balance of your loan per year.

Annual MIP payments will be made in monthly installments for the life of the loan if you put down less than 10%. If you put down more than 10% you will pay it for 11 years.

USDA Mortgage Insurance
Loans from the United States Department of Agriculture (USDA) are available with 0% down payment to purchase a home in an area defined as rural. For these loans, you will have to pay two fees: an upfront guarantee fee you pay once and an annual fee you will pay every year for the life of the loan. The upfront guarantee fee for 2021 loans is 1% of the loan amount and you pay it when your loan closes. The annual fee is 0.35% of the average loan balance for the year and is divided into monthly installments and added to your mortgage payment.

No Mortgage Insurance for VA Home Loans
The United States Department of Veterans Affairs (VA) home loans are a type of mortgage available to assist active service members, veterans, and surviving spouses in buying, building, and retaining a home. A VA loan allows qualified borrowers to purchase a home with 0% down payment and without mortgage insurance.

Mortgage insurance can be expensive, but don’t let it keep you from getting into a new home. Work with your Mann Mortgage lender to find what your mortgage insurance payments would be or whether you can qualify for a loan that doesn’t require it. Together, you can decide on the right path forward to get you into a new home.

Tips for first-time home buyers

Whether it’s your first time buying a home or it’s been a few years since you last bought one, knowing where to start is your first step towards finding a home that fits your needs.

Save for a down payment
The amount of money you’ll need for a down payment depends on the type of loan you choose and the price of your home. Some conventional loans are specifically aimed at first-time home buyers with good credit and a 3% down payment and others are available to borrowers with 0% down.

Talk to a local home loan expert
There are a lot of options for financing your new house. Before you get too excited about a new home, you’ll want advice from a pro. Find a local home lender with great reviews and a solid reputation and set up a meeting with one of their loan officers. They’re experts in finding the right loan for their clients’ needs. You’re under no obligation to work with any lender you speak with and your meeting time is free. The information they’ll provide to you will let you know what type of loan you’re eligible for, first-time home buyer assistance programs for your state you could take advantage of, the approximate interest rate you would pay, and the price range for a house you would be able to afford.

>> Mann Mortgage has a rating of 4.89/5 stars with more than 15,000 reviews on SocialSurvey.

Get a pre-approval letter
When you’re ready to start home shopping, ask your home lender to pre-approve you for a loan. They’ll pull your credit score and history, verify your income, check your assets, calculate your debts, and approve you for the appropriate home loan. Your lender will give you a blanket letter stating you’re approved for a loan up to a certain amount of money or they will write you a personal letter for the home you are putting in an offer for. Either way, the pre-approval letter lets the home seller know you are a serious bidder already working with a lender, so your financing should go through without a problem.

>> What happens when a lender pulls your credit?

Choose the right real estate agent
Find someone with intimate knowledge of the community you’re purchasing in. They should be able to answer questions about the housing inventory, schools, traffic, and much more. Ask for a referral from your home lender, friends, co-workers, and neighbors. You can even drive or walk around the neighborhood you’d like to buy in to find agents selling in the area.

You’ll know you’ve found the right agent when they answer questions quickly, work as a Realtor fulltime, close on deals, and are willing to educate you about the local market and homes you’re interested in.

Know what kind of market you’re purchasing in
When you find the home with the right size, location, age, and price range, the way you make your offer may depend on the type of market you’re in. Generally speaking, there are two markets: a buyers’ market and a sellers’ market.

If you’re in a buyers’ market: A buyers’ market means there are more homes available than people to buy them. This is great news for a buyer. You’ll have plenty of homes to choose from and you’ll have time to weigh the pros and cons each before you put in an offer. Offers with contingencies such as financing, home sale, or inspection will have a much higher chance of being accepted than they would in a sellers’ market.

If you’re in a sellers’ market: A sellers’ market means there are less homes available than people to buy them. Be prepared to act very fast when you see a house that meets your needs as it’s possible a home seller will receive multiple offers within days of the house being listed. Be prepared to make multiple offers on homes before one is finally accepted. It’s going to be tough to get a house and you’ll be competing with other very serious buyers (some people make offers in cash -meaning they don’t have to finance the house, they have the money to buy it outright). Talk with your Realtor about what you can do to make your offer more likely to be accepted. Some common tactics are:

  • Have a home loan pre-approval letter.
  • Don’t plan on negotiating – make your first offer strong.
  • Waive as many contingencies as possible.
  • Write a personal letter to the seller when you make an offer.
  • Put an escalation clause on your offer. This means you make an initial offer but also set a maximum offer. If the seller receives another offer that’s higher than your initial offer, your offer will increase by a set amount to beat the other offer up to your maximum price.

Get ready for closing
If your offer got accepted and all the contingencies were removed, you should be ready to close. Closing is the final step in transferring ownership from the seller to you. Your home lender will originate and underwrite your loan and the title company will prepare a lot of paperwork for you to sign.

>> What to expect when closing on your new home.

When you’re ready to talk to a professional loan officer, contact your local Mann Mortgage office. Our loan officers are very familiar with helping first time home buyers understand their loan options, the local housing market, and how to finance the right home.

The difference between a 30 and 15-year fixed mortgage

A mortgage term is how long it will take you to repay the loan in full. There are a few term options, but most common are 15 or 30-year terms.

Both mortgage options are fixed rate meaning the interest rate and monthly payment is set when the loan is taken. A fixed-rate makes it much easier for a borrower to budget since they know exactly how much the minimum payment is each month for years to come.  No matter what happens with interest-rates, the minimum payment won’t change.

30-year mortgages are by far the most popular mortgage product for American homebuyers – Freddie Mac says 90% of all loans are 30-year fixed. What makes them so appealing? Are there any benefits to a 15-year fixed?

30-year mortgage
Because the term of the loan is longer, there is a higher chance the borrower will default over time, so it’s a riskier option for lenders. But the payoff for borrowers is big – substantially lower monthly payments than a 15-year mortgage.

A lower monthly payment makes homeownership a possibility for more Americans and it may allow some people to purchase more home than they’d be able to with a 15-year fixed. Even borrowers who could afford to make larger payments may choose a 30-year fixed and re-invested or put away the money they’re saving to further their financial stability.

The catch? You’ll save money each month, but you’ll be paying your mortgage for longer. And, in the end, you’ll end up paying much more in interest than you would with a 15-year loan for the same house.

15-year mortgage
Lower monthly payments sound great, so why would anyone get a shorter loan term? Borrowers often choose a 15-year loan because they pay off the loan much faster and with less interest overall. Take the example below.

$275,000 Mortgage
 APRMonthly paymentTotal interest paid
15-year fixed2.529%$1,837$55,737
30-year fixed2.948%$1,152$139,617

The monthly payments are nearly $700 more per month, but over the course of the loan, the borrower saved $83,880. If you can afford a bigger payment, looking into a 15-year fixed mortgage may be a good idea.

Because there’s less time for the loan to be exposed to risk, interest rates for 15-year mortgages are usually lower than that of 30-year fixed. The rate can be around a quarter to a whole percentage point less.

How about something in-between?
If you like the lower payments of the 30-year mortgage but the faster payoff of the 15-year mortgage, consider getting something in between like a 20-year mortgage. There are a lot of different options when it comes to home loans. It’s best to speak with a local loan expert to see what would work best for you and what your payments would be like with each option. Together, you can find the best path forward for your financial goals.

Financial benefits of owning a home

Buying a home has long been considered part of the American dream. But when you consider a home as a financial investment, is it a good choice? Below is a review of some big financial benefits of homeownership.

Build equity
Equity is the value of the property you actually own. As example, if your home is valued at $300,000 and you owe $200,000 on it, you have $100,000 in equity.

Unlike rent payments, each time you pay your monthly mortgage you gain a little more equity in your home. As you continue to pay off your loan, more money will go towards the principal every time – bringing you closer to owning more of you home. Eventually, all payments will have been made and the loan satisfied, you will no longer have a mortgage payment at all.

Get tax deductions
If you’re itemizing your tax deductions, there are a few tax breaks you get as a homeowner including writing off interest payments, real estate taxes, and energy-efficient improvements. When you sell your home, you may be able to avoid some of the capital gains tax on the profit you’ve made as long as you meet certain requirements (like having lived in the house as a primary residence for at least two of the previous five years you owned it).

Price appreciation
Houses (and the land they’re built upon) generally increase in value every year. The last quarter of 2020 saw home prices increase in value by an average of 4.29% according to S&P/Case-Shiller. So as you’re paying off your home, it will hopefully be increasing in value on its own. Just be aware that homes aren’t guaranteed to increase in value, and you’ll be able to take advantage of the appreciation only after owning it for many years.

A fixed monthly bill
A huge benefit of homeownership is that you’re better protected from inflation. If you have a fixed-rate mortgage, the amount you pay each month for your home won’t change no matter what happens to the interest rate and the economy. Even adjustable-rate mortgages have an interest rate cap to protect the homeowner. As rent continues to increase, having a steady mortgage payment that won’t increase will offer peace of mind when you’re budgeting.

Get better credit
Having a long history of making payments towards a big debt does wonders for your credit. Since mortgages typically last 15 to 30, if you make your payments on time, you can expect it to positively impact your score. Regular on-time rent payments can also positively impact your credit, but not automatically. Your rent payments must be reported to select credit agencies using a rent-reporting service.

Is a home purchase a good investment for you? You’ll need to crunch the numbers to decide. Take stock of your own financial standing and the average price of a house in your area compared to the price to rent a home. When it comes to purchasing a home, it’s always best to talk with a local home loan expert. They will tell you what loans you’ll qualify for, the minimum down payment, and provide info on the market you’re looking to buy in. Together you can review your financial goals to see whether owning a house would positively or negatively impact your future.

Conforming loan limits for 2021

When applying for a mortgage, one of the most popular options is a conforming loan. These loans are called “conforming” because they conform to the guidelines set by Fannie Mae and Freddie Mac, federally backed home mortgage companies created by the U.S. Congress to boost homeownership.

What do Fannie Mae and Freddie Mac Do?
These entities exist only to support the U.S. mortgage system. They don’t originate loans. Instead, after a loan has been issued, one of the entities will buy the loan from the lender if it meets their criteria. This is an important part of the mortgage market because it allows lenders to sell loans to Fannie Mae and Freddie Mac and use the cash raised to engage in further lending.

For a loan to be purchased by Fannie Mae or Freddie Mac, the borrower generally needs:

  • A good credit score
  • A debt-to-income ratio of 50% or less
  • At least 3% down payment
  • A loan amount of less than conforming loan limit

2021 conforming loan limits
Each year, the Federal Housing Agency decides what the conforming loan limit is. As houses become more expensive, the limits are increased. In 2021, the amount increased for all units.

2021 Conforming Loan Limits
UnitsBase LimitHigh-Cost Limit


Base limit: This is the maximum loan amount for homes in most areas of the United States.

High-cost limit: This is the maximum loan amount for homes in high-cost markets such as parts of Alaska, Hawaii, California, and Washington, D.C.

Units: The number of housing units per building.

More >> See what the conforming loan limit is where you live.

Because conforming loans can be re-sold, they’re not as risky for lenders and often have favorable terms for borrowers. Savvy home buyers will keep their loan amount within the conforming loan limits so they have an easier time securing their loan, they’ll have more relaxed requirements, and their rates will probably be better.

If you’re looking for a conventional 15 or 30-year loan (as most people are), you may want to consider keeping the loan amount under the loan limit in order for it to be a conforming loan.

When you need a bigger loan – consider a jumbo loan
If the limits won’t get you a home you’re interested in buying, you could look into a jumbo loan. Jumbo loans won’t be purchased by Fannie Mae or Freddie Mac, so they don’t need to conform to their loan limits – meaning you can get more money. If you have a strong credit score and low debt-to-income ratio, you may find a lender willing to extend one to you.

However, they come with some disadvantages. Jumbo loans have stricter qualification rules, require a sizable down payment (sometimes 20% or more), and normally have a higher interest rate. For those reasons, a lot of homebuyers try to avoid them by finding a home that will keep them within the conforming loan limits.

To see whether you’ll be eligible for a conforming home loan, contact your local Mann Mortgage home lender. Together, they’ll help you crunch the numbers to see what type of loan would be best for you.

5 tax deductions homeowners can use

One of the perks of being a homeowner is getting to use your home for tax deductions. Tax deductions reduce how much you pay in taxes by lowering your taxable income.

When filing your annual taxes, you can use standard or itemized deductions. Standard deductions are a set amount deducted from your adjusted gross income based on factors like your marital status, filing status, and age. For the 2021 tax year, it ranges from $12,550 to $25,100.

Itemized deductions allow you to manually add each item you’d like to deduct from your adjusted gross income.

If you use itemized instead of claiming the standard deduction, you can take advantage of the following homeowner deductions:

Mortgage interest
Depending on the type of mortgage you have and the way you file your taxes, you may be able to deduct interest payment on your mortgage, home equity loans, and lines of credit (if they were used to buy, build, or improve your home). The amount may vary, but for the 2021 tax year you can deduct up to $750,000 in mortgage interest.

Real estate taxes
You can deduct the real estate taxes you paid for your primary residence, co-apartment, vacation home, or land.

Mortgage points
The year you purchase mortgage points, the full amount you paid can be an itemized deduction. If you can’t deduct the points in the year you bought them, you may still be able to deduct them over the life of the loan.

Mortgage insurance
For the 2020 tax year, the amount you paid for private mortgage insurance premiums (or mortgage insurance premiums for FHA-baked loans) can be an itemized deduction. However, your loan must have been taken out after January 1, 2007 to qualify.

Energy-efficient improvements
Renewable energy tax credits are available for both existing and new construction primary and secondary homes. To see a full list of credits, visit

Possible first-time homeowner credit: This isn’t a tax credit, but it’s something to be aware of if you’re considering buying a home for the first time. If coming up with a down payment is keeping you from becoming a home buyer, keep an eye out for the proposed First Down Payment Tax Credit. President Joe Biden’s administration is looking into offering up to $15,000 to qualified buyers at closing. This credit is designed for those who can qualify for a home loan based on their credit score and debt-to-income ratio but could use $15,000 to meet the down-payment qualifications of the loan. If this credit becomes available and you meet the qualifications, you should contact a loan officer to discuss it.

The above list will give you an idea of some of the tax benefits available to homeowners. At Mann Mortgage, we’re home loan experts, not tax pros. If you have any questions about your taxes, be sure to work with a local tax professional.

There are a lot of financial benefits for home ownership. If you’re interested in finding out how your current home or new home can best benefit your financial goals, give us a call. We’ll crunch the numbers together and find the right mortgage program for you.

Buying a house when you have student loan debt

More than half of all college students have taken on some form of debt in order to pay for their education – mostly through student loans. The average outstanding amount owed? Between $20,000 and $24,999. If you’re among those that have student loan debt, what are your options for getting a home loan? 

Do lenders look at debt?

When issuing credit, lenders biggest concern is whether a borrower will be able to pay the loan back. They use a lot of calculations to figure it out. One of the major ones is to divide the borrowers’ monthly debts by their monthly gross income. This is called a borrower’s debt-to-income ratio.  

To get an idea of your debt-to-income ratio, consider the amount you pay each month for your minimum credit card payments, auto loan, rent, mortgage, student loan, and other monthly payments. Keep in mind that lenders will look at what you pay each month, not the total amount you owe. If you have $20,000 in student loan debt and make $200 monthly payments, your lender will use the $200 monthly payments in the calculation. Now, divide the amount you pay each month by your gross monthly income (before taxes and other deductions). This is your debt-to-income ratio. 

Generally, lenders want to see, at a minimum, a ratio of 50% or less. 

Pay down your student loans before getting a house?

Thinking about waiting to purchase a home until your student loan debts are paid down can feel like putting your life on hold. Whether you should pay off or down your student debt really depends on your unique financial situation. The price of a home ownership far exceeds just the monthly mortgage bill. There’s insurance, property taxes, utilities, maintenance, and plenty of small expenses. On the flip side, making a wise investment in a home could provide you with financial stability in the right real estate market.  

Speak openly with your home loan officer to decide whether now is the right time for you to invest in a home. They’ll be able to give you expert advice about your real estate market, interest rates, and financial requirements for loans you may qualify for. 

What home loans are available to people with student debt?

Many loan options are available to people regardless of the type of debt they have. Some favorites among young borrowers with student loans are conventional, USDA, VA, and FHA loans. 

Conventional loans
If you have decent credit and can make a down payment of at least 3.5%, a conventional loan will offer you many great benefits including PMI fees that stop once you reach 22% equity in your home. 

USDA loans 
If you’re looking to purchase a primary home in an area defined as “rural” by the USDA, a USDA loan is a great choice. Chief among the benefits for those with student loan debt is a 0% minimum down payment and no private mortgage insurance fees. 

VA loans 
Another great 0% down payment option for those who are former or current members of the U.S. military. VA loans are available to fund the purchase of primary residences only. 

FHA loans 
If your credit has been diminished by student loan payments, consider an FHA loan. They’re available to borrowers with FICO credit scores as low as 500. You’ll have to make a down payment of 3.5 to 10% depending on your credit score, but it may be a good option to start building financial stability with a home. 

Should you buy a home now? 
Depending on your financial goals, taking advantage of the low interest rates might be a great choice. Contact your local loan officer to help you make the decision about whether you’re ready for home ownership or if it would be more advantageous to wait. 

Buying a home during a pandemic

There’s no doubt that Covid-19 has impacted how Americans are buying and selling their homes. Social distancing rules, historically low interest rates, and more people working from home have all changed, but certainly not stopped, home sales. 

What homebuying trends can we expect to continue through 2021? 

Virtual home tours


Don’t assume you’ll be able to attend open houses or leisurely tour homes on the market. In order to limit exposure to COVID-19, many sellers allow just the realtor and buyer into the house – with masks and gloves on, of course. No children or extra family/friends are allowed. Last year when Zillow surveyed  home sellers, 43% of them said they’re likely to try to sell their homes entirely online. 

Faster internet connections and better technology have given real estate agents a new tool – virtual tours. In addition to posting better photos, sellers’ agents are offering 3D virtual tours as part of their home listing. If you’d still like to see the home for yourself, your real estate agent can schedule an online video meeting. That way, you can watch a live video, ask questions, and talk to your agent while they tour the home for you. 

Low interest rates


Rates have dropped like they’re hot. They’re the lowest they’ve been in 50 years, and they’re projected to stay low. Mortgage interest rates are partly based on what the Federal Reserve sets for the federal funds rate. And Federal Reserve Chairman Jerome Powell told NPR in an interview in September 2020, “We think that the economy’s going to need low interest rates, which support economic activity, for an extended period. It will be measured in years.”  

Low interest rates are a boon to home buyers. Last year, 30-year fixed mortgage interest decreased by 1.07%. On an average home loan of $250,000, that’s a savings of about $150 each month between the two rates. That means buyers can afford more expensive homes – and they’re going to need those rates to stay low to compete in this real estate market. 

Sellers’ market with bidding wars


We’re generally in what’s considered a “seller’s market”. In many areas, more people are looking for houses than there are houses available. A sellers’ market means we can expect home prices will continue to rise, though experts predict it will happen at a slower pace than we saw in 2020. 

To buy a home in a seller’s market, be prepared to have a better offer than your competition. More than 20% of homes in the U.S. market are selling above their asking price, according to a recent Zillow report. Most commonly, it’s happening among homes priced below $259,906. And Redfin reported more than half of all offers were involved in bidding wars from May through November 2020. That means multiple offers at the same time, often driving up the price above what it was listed for in hope of winning the home. 

Fast-moving inventory


Homes were averaging five days less on the market in 2020 then they were just a year before. Zillow reports homes spent an average of just 25 days on the market before accepting an offer. In September, homes moved even faster – the average was under contract in just 16 days. 

What does all this mean for home buyers? When you see a house that fits your needs, make an offer quickly and be prepared to find out others have made an offer as well. Competing for homes can be an emotional roller coaster. Your best bet for staying level-headed is to work with your loan officer to set your budget and be prepared to walk away from a home you can’t afford. 

Buying a second house using a home equity loan

Purchasing a second or a vacation home is a dream for many people. But saving enough for a down payment may be a considerable barrier. A home equity loan could be the solution.

If you own a home and you’ve built equity in it, it may make sense to use that equity as the down payment to purchase a new or investment home. This could be done in the form of either a home-equity line of credit (HELOC) or home equity loan.

Your home’s appraised value, your equity in it, and your financial profile will all be used by your lending institution to determine whether you’re eligible for additional financing.

Can you have more than one home equity loan?

You can have as many mortgages and equity lines or loans as you can qualify for. As long as you aren’t overburdened or own more than your property is worth, there are no limits on the number of loans you can have at one time.

Your lender may be less willing to extend further lines of credit to you if you already have one outstanding with them. Rather than taking out two of the same type of loans (two HELOCs or two home equity loans), you may have better luck getting one of each instead. This is because each is looked at as a different type of credit – a HELOC with a revolving credit and a home equity loan with a fixed rate.

Finance for a down payment?

Usually, you can borrow up to 80% of the current value of your home less what you owe for your mortgage. As example, if you have a $500,000 home and owe $300,000 on the mortgage, you’d have $100,000 available for a down payment (80% of $500,000 is $400,000. $400,000 – the $300,000 mortgage = $100,000).

If you’re able to take out a loan for more than 80% of your home equity, you will likely have to pay PMI on your original home loan until you have 22% equity in it again.

Benefits to financing a second home with equity

Home equity credit offers some of the lowest consumer rates on the market because they’re secured by high-quality collateral – your home. The terms your lender can offer you are often far better than anything you could secure on a similar personal loan.

Talk to your local Mann Mortgage branch to see whether using the equity in your home is an option for you when considering a new or investment home.

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