Our vacation home mortgage calculator works out the monthly payment and full amortization schedule on a cottage, cabin, ski condo or beach house. Enter the purchase price, down payment, interest rate and loan length. Want to know how much vacation home you can afford first? Try our Can I Afford a Vacation Home Calculator.
Vacation Home Mortgage Calculator
Complete the vacation home mortgage calculator inputs to determine your total monthly mortgage payments.
Vacation Home Mortgage Guidelines
Lending Guidelines, Interest Rates and Down Payment Requirements
Rates have risen sharply since 2021, so run the numbers at today’s rates before you commit. The average US 30-year fixed rate was 7.32% on October 22, 2026, and in 2025 loan data, second-home loans cost about 0.375 points more. In Canada, 5-year fixed, uninsured mortgages were around 5.0% on October 28, 2026.
Yet, mortgages for vacation homes are typically accompanied by larger down payment requirements, higher interest rates and more conservative lending guidelines. This is due to the increased risk profile of a vacation property as owners may be more willing to walk away from their mortgage when faced with financial hardship. For instance, while certain lenders may require a down payment of only 5% for a primary residence, lenders will want more down for a vacation home. In the US, Fannie Mae’s minimum is 10% for a second home. In Canada, a personal-use second home can qualify with 5% down on the first $500,000 and 10% on the portion above that, through private insurers such as Canada Guaranty; CMHC no longer insures second homes. The home must be winterized, with year-round access, and priced under $1.5 million.
Still, favorable mortgage terms on second homes are often available for qualified borrowers.
Borrowing Capacity
The amount you can borrow towards a vacation home will depend on a number of factors, including those factors noted below.
Consider Debt to Income Ratio
Your debt to income ratio is the percentage of your gross monthly income that goes to paying your monthly debt payments (total monthly debt payments divided by gross monthly income). Although each lender will have its own specific requirements, most financial experts recommend keeping your debt-to-income ratio at 30% or less for home expenses. Fannie Mae allows up to 50% through its automated underwriting, but many lenders set a lower limit, often around 43–45%.
For illustrative purposes let’s use a ratio of 30% for home expenses and assume your gross monthly income equals $10,000 before taxes. This means that your total mortgage, home insurance and property taxes can total up to $3,000 per month (30% of $10,000). If payments for your primary residence total $1,500 each month, this means that you can afford to pay $1,500 per month for a vacation home. Using the vacation home mortgage calculator below, this means you can likely afford a vacation home with a purchase price of about $263,000, assuming 20% down (about $52,600) and a 7.7% interest rate over 30 years.
Home Equity Line of Credit
If you have managed to pay off a portion of the mortgage on your primary residence, you may be able to borrow against the value of your home to maximize your borrowing power. A popular way of extracting this value is through a home equity line of credit. Many banks will allow you to borrow up to 80% of the appraised value of your home less the amount you owe on your first mortgage (although HELOC loans with federal financial institutions in Canada are limited to 65% of the appraised value, per OSFI Guideline B-20). Keep in mind that the maximum borrowing limit includes your first mortgage. So assuming your home is worth $450,000 and you have $100,000 left on your mortgage, you would have up to $260,000 (80% of $450,000 less outstanding mortgage of $100,000) available towards an investment in a vacation home. If a HELOC is not available to you, consider taking out a second mortgage instead.
How Rental Income Increases Borrowing Capacity
If you plan on renting out your vacation home part time, you can use the rental income to offset the costs of owning a home. Depending upon the lender, you may also get credit for up to 70% to 75% of the projected fair market rents. For illustrative purposes, let’s assume you have a gross monthly income of $10,000 before taxes and that your monthly costs are $2,000 for your primary residence and $2,500 for the vacation home. Your debt to income ratio would equal 45% for home expenses ($4,500 / $10,000), or 15% in excess of what lenders will typically permit. But let’s also assume that you can generate $2,050 per month in rent from an income suite in your vacation home. After receiving 70% credit for the rental income ($1,435), from a lender’s perspective your debt to income ratio is now a more modest 30% for home expenses (($4,500 – $1,435) / $10,000). Keep in mind that this applies only to an income suite or a property the lender classes as an investment. For a vacation home you use yourself, lenders usually won’t count the rent.
Frequently Asked Questions
What’s the Monthly Payment on a $500,000 Vacation Home?
With 20% down ($100,000) at 7.7% over 30 years, about $2,850 a month in principal and interest, before property taxes, insurance and any strata or HOA fees.
How Much Do I Need to Put Down on a Vacation Home?
At least 10% in the US for a second home you use yourself. In Canada, a personal-use vacation home can qualify with 5% down on the first $500,000 and 10% on the rest, through private insurers; CMHC no longer insures second homes. Rentals need more.
Are Vacation Home Mortgage Rates Higher?
In 2025 loan data, by about 0.375 points. With the US 30-year average at 7.32% on October 22, 2026, the calculator defaults to 7.7%.
Be sure to also check out our additional vacation home calculators, including our Cost of Owning a Vacation Home Calculator.
Written and developed by Peter Davis. Peter owned and operated multiple vacation rental properties in Whistler for almost a decade. He writes about buying, financing and owning second homes in the US and Canada.