SurfNturf- Another type of loan is the HELOC or the home equity line of credit. This is a revolving account that works much like a credit card.
Once any amount is drawn on the account, then the payments begin. Sometimes if seeking a mortgage on a second property that happens to be a condo may not go through, this may be an option.
The reason why many of these mortgages are declined is that the condo associations are riddled with debt.
Any condo complex that has a foreclosure rate higher than 10% as well as an owner occupancy rate of less than 50% will be declined.
Banks want at least 50% owner occupants because they feel that renters will not care for the unit like an owner. Many condo complexes fall into the decline area.
Using a HELOC on another property with significant equity can take care of this problem. This would be considered a cash sale.
The only word of caution is that a HELOC is a recourse loan meaning that even if they foreclose on your home the banks have a legal right to continue to seek payment from you. This is different than a traditional mortgage where once it is foreclosed there is no other debt.