Four Ways to Finance Your Minnesota Dream Cabin
If you dream of owning a cabin in Northern Minnesota, now is a great time to pursue that dream! One question potential cabin buyers always have is how to pay for it. When it comes to financing a cabin, you have multiple options:
If you’ve already paid off your first mortgage or would like a conventional loan for your cabin up north in Minnesota, getting a vacation home loan is your first option. We recommend using a mortgage lender who specializes in second homes in the local area. These lenders will have ready financing sources and understand the required rules and specifics of the place you’re buying in.
If you have equity in your home and it makes financial sense, you might be able to refinance at the current rate and get the cash to buy your vacation home by doing a cash-out refinance. A cash-out refinance allows you to replace your current loan with a new mortgage loan for a larger amount than the existing mortgage and keep the difference between the two loans in cash.
Home Equity Loan
Home equity loans are a very popular way of financing a cabin. They allow you to borrow money against the equity you’ve built up in your home. This type of loan is a lump-sum payout with a fixed interest rate and is paid off in equal monthly payments, like the mortgage on your primary home.
Go in with Friends or Family
Sometimes buying your Minnesota dream cabin might feel out of reach. One option you could consider is going in on a vacation property with friends or family. Two checkbooks are larger than one and could make buying a vacation home achievable.
Need help finding your dream cabin in Northern Minnesota? We would love to help! Bill Hansen Realty is the market leader in Northern Minnesota. Please click here to contact us.