There are many types of mortgages and financing options available on Long Beach Island and it is important to understand the differences between them so as to not overpay in the LBI real estate market. There are loans available for second homes, investment properties, vacant land, storm damaged homes and construction projects as well as duplexes and small condominiums in the LBI real estate market. Please remember that I am a real estate agent and as such cannot give specific mortgage advice. The information I have provided is intended as a general overview of the options available to most consumers. It is best to contact a lender for specific terms and qualification information. I can provide the names and phone numbers of some of the lenders I commonly work with.
There are a number of mortgages available to home buyers however not all are applicable to the LBI real estate market. Primarily, there are three Financing Options in the LBI NJ Real Estate Market that are utilized by the majority of buyers on Long Beach Island. They are:
Before we begin, it is important for any prospective buyer to speak with their mortgage representative. Every situation is different and will vary greatly depending on an individual’s financial position at the property they are looking to purchase. That said, there are some generalizations we can make about second home loans in the Long Beach Island real estate market.
Unlike a mortgage for a primary residence, most loans work will require a minimum of 20% down payment. In the primary mortgage market, there are special products that will allow for low or 0% down payments… But these are not intended to be used for a vacation home or investment property.
Construction loans differ from a conventional loan in many ways. The terms and conditions of a construction loan will depend greatly on the individual applying for the loan and the institution offering the product but in general there are a few “standards” to go by. For example:
There are a number of alternative strategies for financing a home in the LBI real estate market. For example:
Seller financing is a rather straightforward process by which a seller, assuming they do not have a mortgage themselves, may allow transfer of the property to the buyer for only a down payment and a monthly payment for a short period of time. This can be particularly useful for someone looking to build a new home. Since construction loans can be difficult to obtain, a seller may allow a short-term mortgage, for one or two years, so the buyer can utilize a supply of cash to build a new home. Once the new home is complete, it can be refinanced and the seller can be paid off in full. This can have many advantages as the loan will be less expensive for the buyer, and the seller will obtain more money in the long term through interest payments.
Understanding Long Beach Island property appraisals can help a buyer make a smart choice when investing in the LBI real estate market. Basically, an appraiser follows these steps:
When an appraiser visits a home in person he or she will take measurements of the rooms and structure, draw a floor plan, take photos, And note specific characteristics such as a view and distance to the beach.
