What's the difference between a vacation home loan and an investment property loan?

Lenders distinguish between the two based on your intended use. A vacation home is one you personally use for recreation — rates are lower and down payments can be as little as 10%. An investment property is one you rent out for income — rates are typically 0.5–1% higher and most programs require 20–25% down. Misrepresenting occupancy intent is mortgage fraud, so we'll walk you through the guidelines carefully.

Can I rent out my vacation home on Airbnb or VRBO?

Yes, in many cases — as long as you also use the property personally for a qualifying portion of the year. The IRS 14-day rule and lender occupancy requirements both apply. We'll review your specific plans and confirm which loan classification fits your intended use.

Do I need to sell my current home first?

No. You can carry both a primary mortgage and a vacation home mortgage simultaneously, as long as your debt-to-income ratio supports both payments. We'll calculate your combined qualifying ratios before you shop.

What happens if I decide to rent it full-time later?

If your use changes to full-time rental, you should notify your lender — the loan may need to be refinanced as an investment property. Rate and equity differences apply. We'll help you plan that transition if and when it makes sense.

Are condo vacation homes eligible?

Yes, with conditions. The condo project must be warrantable (Fannie/Freddie approved) and cannot be part of a hotel or rental pool program. We'll check project eligibility as part of your loan process.

Home ResidentialVacation Home Loans

Second Home Financing

Finance the Getaway You've Earned.

Competitive second-home mortgage rates for beach houses, mountain cabins, lake retreats, and everything in between — with no rental income restrictions on your personal use.

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10%

Minimum Down Payment

680

Min. Credit Score

Fixed & ARM

Loan Types

Personal Use

Occupancy Requirement

Overview

Your Second Home Is a Real Estate Asset — Finance It Like One

A vacation home loan is a conventional mortgage designed specifically for second properties you intend to use personally — not as a full-time rental. Because lenders classify these differently than primary residences and investment properties, the rate is typically slightly higher than a primary mortgage but meaningfully lower than a pure investment loan.

At Lumen Mortgage, we help you navigate the occupancy rules, qualifying guidelines, and loan structures that make vacation home financing work — whether you're buying a beach cottage in Cannon Beach, a ski cabin near Mount Hood, or a lake house in the Sierra Nevada. We're licensed in Oregon and California and know these markets well.

Who This Is For

Buyers purchasing a second home for personal and family use

Homeowners who already own a primary residence with sufficient equity

Buyers comfortable with a 10–20% down payment on a second property

Borrowers with 680+ credit scores and stable income documentation

Owners who may occasionally rent the property but primarily use it personally

Oregon and California buyers seeking mountain, coast, or lake properties

Key Features

What Makes This Program Work

Conventional Second-Home Rates

Vacation home loans price as second homes — not investment properties — delivering rates typically 0.25–0.75% lower than a full investment loan.

10% Down Available

Unlike many investment loans requiring 20–25%, qualifying vacation home loans can be structured with as little as 10% down for well-qualified borrowers.

Fixed & ARM Options

Choose a 30- or 15-year fixed rate for long-term stability, or an adjustable-rate mortgage if you plan to sell or refinance within a set horizon.

Occasional Rental Permitted

You can rent your vacation home for part of the year without it being reclassified as an investment property — as long as personal use meets lender occupancy requirements.

Equity Access via Cash-Out Refi

Once you've built equity, a cash-out refinance on your vacation home lets you fund improvements, pay down other debt, or invest without selling.

In-House Processing

Every loan is processed, underwritten, and funded in-house — faster timelines, direct communication, and no third-party delays.

Have questions about this loan?

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Get a personalized rate quote with no impact to your credit score.

503-966-9255

The Process

How It Works

Scenario Review

We'll review your primary residence equity, income, and overall debt picture to determine how much vacation home you can comfortably finance and which program fits best.

Application & Pre-Approval

Complete our streamlined online application. We run a soft credit inquiry first — hard pull only when you're ready to move forward on an offer.

Property Review

We confirm the property meets second-home occupancy and condition guidelines. Condos may require HOA review; rural properties may need additional evaluation.

Appraisal & Processing

We order your appraisal and gather documentation simultaneously to keep your timeline moving. Most vacation home loans close in 21–30 days.

Clear to Close

Once underwriting is satisfied, we issue your clear-to-close. Sign, fund, and get the keys to your getaway.

Requirements

General Qualifications

Must be a one-unit residential property (single-family, condo, or PUD)

Must be suitable for year-round occupancy

Must be located a reasonable distance from your primary residence

Borrower must occupy the property for some portion of the year

Property cannot be subject to timeshare or rental pool arrangements

Minimum 10% down payment; 20%+ avoids PMI

680+ credit score recommended for best rates

Stable, documented income (W-2 or self-employed with 2-year history)

Debt-to-income within conforming guidelines

Licensed in Oregon and California (NMLS #1498678)

Ready to See If You Qualify?

Every borrower's situation is unique. Give us 15 minutes and we'll review your financial picture, identify every program you qualify for, and walk you through your options — at no cost and with no obligation.

Licensed in Oregon & California · NMLS #1498678

Related Programs

Refinance

Already own a vacation home? Lower your rate or access equity with a vacation home refinance.

Investor Loans

Buying a property primarily for rental income? Our investor and DSCR programs may be a better fit.

Portfolio Lending

Unique property or non-conforming scenario? Our in-house portfolio loans offer flexible underwriting.

FAQ

Common Questions

What Our Clients Say

Five-Star Reviews from Real Borrowers

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"Great communication, efficient processing and good turn around times on approvals and closings."

Laura Garifalakis

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"Lumen Mortgage is the absolute best mortgage team we have ever done business with. We felt through the entire process that we were working with them as a team for one goal, to get us in the right home at the right price for us."

S K

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"David and his team are top-notch. We've worked with many lenders over the years and David is in a league of his own. We'll never use a different lender!"

Wendy Lewis

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"With mortgage rates at historic lows, I decided to refinance. Unimpressed with my current mortgage lender's rates (Bank of America), I did some digging and found great rates that would need to be brokered privately. I remember a friend mentioning Lumen, so I fired off an email, and what do you know - ~2 weeks later I closed at a fantastic rate! 2 weeks!"

Derek Meyer

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"Lumen Mortgage was excellent to work with. They were there step by step explaining everything. This was exceptional as I was helping my parents (English 2nd language) through this process. The team was patient and super informative."

Tony Singmeuangthong

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"Great experience working with Lumen Mortgage. Extremely knowledgeable and professional. I would highly recommend!"

Kasey Clemens

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Ready to Get Started?

Our loan officers will review your scenario, walk you through your options, and guide you from application to close — with full transparency at every step.

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