What is the difference in 1st home, 2nd home and investment mortgages?

Question

I understand the difference in the definitions of the use of the property, but what does this mean in terms of the mortgages offered for each type of use?

Is the difference in the rate, term, max LTV? Something else?

If you have one residence in a town and want to buy another, but expect to occupy the 1st for some time while you rennovate the 2nd, will the "use" of the 2nd be considered a primary residence?

Thanks

Answer 1

Yes if you buy the second as a primary residence it is even if you don't move right in. A vacation home or investment cost you more because you are more likely to not kill yourself trying to not let it be foreclosed. Given tough times and 2-3 properties with mortgages most people choose to save the primary residence.

Answer 2

1st home...is where you will be physically residing more than 6 months out of the year.

2nd home...is another home that you own, that is generally more than 50 miles from your current home and CANNOT be used for rental.

Investment...can be any home, used for rental income.