What Loan Options Exist for a Second Home

Start with what is not available

This is the part most content skips, and it is the part that changes people's plans.

Residential Mortgage publishes a catalogue of loan products and lets buyers filter it by borrower type, including a second home buyer category. Of the twenty-four products listed, exactly two are offered to second home buyers. The programs built around low or zero down payments are not among them. The Residential 100 program, for example, is described in the company's own published guidance as a way for qualified borrowers to purchase a primary residence, and government-backed and state housing agency programs are presented to first-time buyers, veterans, rural residents and low-to-moderate income borrowers rather than to people buying a second property.

So if you have read about buying a home with little or nothing down, that guidance was almost certainly written about a primary residence. It does not transfer. Planning a second home purchase around it is the single most common wasted month in this process.

Source: Residential Mortgage, LLC published loan products.

The two routes that are open

Conventional conforming financing

This is the default and it is where most second home purchases land. Conventional loans follow the standards published by Fannie Mae and Freddie Mac, which is why the guidance on this site keeps returning to Fannie Mae's Selling Guide and Eligibility Matrix. Those documents set out the occupancy definitions, the loan-to-value ceilings and the reserve expectations that a conventional second home file is measured against.

Concretely, and all from Fannie Mae's Eligibility Matrix, August 2026 edition: a one-unit second home purchase carries a maximum loan-to-value of 90%, which is a 10% minimum down payment on a conforming loan. The same matrix sets 85% for a one-unit investment property, which is one of several places the classification decision shows up in real terms. Loans run through Desktop Underwriter carry a two-month reserve expectation on a second home against six months on an investment property.

The down payment guide works through what that means against a real purchase price, and the classification guide covers the occupancy line itself.

Sources: Fannie Mae Selling Guide, Eligibility, Fannie Mae Selling Guide B3-4.1-01, General Asset Requirements.

Portfolio lending

The second route is a portfolio loan. Residential Mortgage's published guidance describes a portfolio mortgage as one that the lender originates and keeps in its own holdings rather than selling on, which allows requirements to sit outside the standards Fannie Mae and Freddie Mac set, in exchange for pricing that reflects the lender carrying that risk itself.

What matters for a second home buyer is the reason a portfolio loan exists at all. It is the route for a file that makes sense to a human being reading it but does not fit neatly into an automated conventional box. That is a real category, and it is worth knowing the door exists before you conclude a purchase is not workable.

Notably, the portfolio product is the only one in the published catalogue offered exclusively to second home buyers rather than shared with other borrower types.

Source: Residential Mortgage, LLC published loan products.

Where non-QM sits

Non-QM lending comes up often in second home conversations, usually in connection with self-employment. The term describes loans that fall outside the qualified mortgage standards set by the Consumer Financial Protection Bureau, and the practical consequence is more flexibility in how income can be documented, including approaches built on bank statements or asset depletion rather than tax returns alone.

It is worth being precise about what non-QM is and is not. It is not a second home program. It is a documentation and underwriting category that can apply to a second home file when the income picture calls for it. If that describes you, the self-employed guide is the closer fit.

Jumbo, briefly

Second homes cluster in expensive markets, so the conforming loan limit comes up more often here than on an average purchase. Once a loan exceeds the limit for its county it is a jumbo loan, underwritten to its own standards. The limits change annually and are set by the Federal Housing Finance Agency, so any figure worth acting on should come from the current year's published table rather than from an article.

How to use this

Before a first conversation, you can settle two things yourself: whether the property is genuinely a second home under the occupancy definition, and what a conventional structure looks like against your purchase price. The calculators handle the second. The pillar guide covers how the whole process runs once those are settled.

Common questions