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Second mortgage

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Mortgage for a second home

Second Home mortgage: Using the value of the first home to purchase the second. 

If you need a mortgage in order to buy a second home, there are different ways to do this.

Value of the first home

If there is enough equity built up on your first home, then it is possible to rearrange your current mortgage and raise it. The paid-off portion of the mortgage is your equity and this equity can then be used to increase your mortgage in order to buy a
second home.


Example 1: An almost paid-off mortgage

For example, if your first home has a value of € 500,000 and your outstanding mortgage is € 100,000, you have built-up a € 400,000 equity in your home. It is then possible to increase the mortgage by € 200,000 to create a new mortgage of € 300,000. That extra € 200,000 can then be invested into buying a second home.


Example 2: Mortgage not yet paid

If there is not enough equity built up in your first home, then you can set up another mortgage for your second home. The type of mortgage that is required depends on your financial situation and the plans you have for the second home. For example, if you plan on renting out your second home, you can get a mortgage that would be different from the one you’d get if you were planning on using the home full time. In this type of situation, the rental income will play a big roll.  


The examples written above differ per situation and bank.

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