To secure a loan for a second home, follow these steps: First, obtain a mortgage pre-approval from a lender to understand your borrowing capacity. Second, calculate the down payment, which typically ranges from 10% to 30% depending on the loan type and lender. Third, compare loan options such as conforming loans (up to $729,750), jumbo loans (for higher amounts), or home equity lines of credit (HELOCs). Fourth, provide documentation including tax returns, pay stubs, bank statements, and property details for the second home. Finally, close the loan by finalizing the agreement and paying closing costs, which average $5,000 to $15,000.

The process requires careful planning due to stricter lending standards compared to primary residences. A 2023 Federal Reserve report found that 68% of second home buyers used conforming loans, with average down payments exceeding $200,000. Lenders may charge higher interest rates (0.5%-1.5% more than primary loans) due to increased default risk, as noted by the Mortgage Bankers Association. HELOCs, popular for smaller amounts, accounted for 22% of second home financing in 2022, per the National Association of Realtors. Additionally, credit scores below 620 face rejection rates of 89%, per FICO data, underscoring the importance of pre-approval and documentation. These factors collectively ensure lenders mitigate risk while meeting borrower needs.