I am building a new vacation house (2nd house) in PA. I already own the land outright. My current house is paid off (worth $700K)… I have no debt and over $400K in near-cash assets (savings, 401K, stocks). My wife and I earn over $250K/yr. The new house may cost me approx $200K to build. I have $50K cash right now and should have another $50K when I start construction. I need a short-term loan, but more like a line of credit that I use when I need to make payments it and repay every month (not a fixed amount) like a credit card. If I borrow another $100K, I can pay it off in a year. I am not looking to touch my savings, so I do want a loan. Even a $100K loan for 2 years in interest will cost approx. $15K assuming 7.5% APR. What kind of rates am I looking at? What is a good type of loan to get? Should I look for a Home Equity Line of Credit? Traditional Mortgage or Interest only loan and repay off early? Where should I apply for it? My Bank? Online?
