21 January 2025 | Written by Mercantile Trust
Product Guide | Understanding Holiday Let Mortgages
Whether you’re planning to invest in a cosy cottage, a beachside retreat, or a countryside escape, or already own one and wish to raise funds from it, understanding holiday let mortgages is essential. This guide explains what holiday let mortgages are, how they work, and how you can make the most of them to maximise your investment potential.
What Is a Holiday Let Mortgage?
A holiday let mortgage is a specialist loan designed for purchasing properties intended for short-term rental use. These properties are typically rented to holidaymakers, and lenders allow a limited number of days for personal use. If you take out a loan with us, you can use your property for personal purposes for up to 90 days per year.
Unlike standard buy-to-let mortgages, which are used for long-term rental agreements, holiday let mortgages are tailored specifically for short-term lets. This offers flexibility to accommodate seasonal income fluctuations while meeting the unique needs of holiday property investors.
Key Features of Holiday Let Mortgages
1. Flexible Rental Terms
Holiday let mortgages allow you to rent out your property for short stays, ranging from just a few days to several weeks.
2. Slightly Higher Interest Rates
Due to the seasonal and sometimes unpredictable nature of rental income, holiday let mortgages often come with higher interest rates compared to traditional buy-to-let loans.
· Unique Affordability Criteria
We accept 100% of current yearly holiday income from a SA302 or accounts certificate. Also, we can use surplus income or personal income to strengthen application.
Using Your Holiday Let to Release Funds
Already own a holiday let property? Whether it’s a charming countryside retreat or a picturesque seaside getaway, you could leverage its value to fund your next investment. A holiday let mortgage can offer the financial flexibility to expand your property portfolio or make improvements to enhance your rental income potential.
How We Can Help
Navigating the complexities of holiday let mortgages can feel overwhelming, but with the right guidance, you can unlock the full potential of your investment. Whether you’re purchasing your first holiday home or mortgaging an existing property, we can help tailor a solution to suit your individual circumstances. Here is some of our criteria:
· We accept Properties in England, Scotland, Wales, Northern Ireland
· You can get a Loans from £10,000
· Property values from £75,000
· We can raise funds on your current holiday let
· We lend up to 75% LTV on a 1st or 2nd charge.
· New properties? No problem! If the property has been owned for less than a year, we’ll consider 50% of the projected income from a letting agent.
Start planning your ideal investment today and turn your holiday let into a rewarding financial asset!
Ready to get started? Contact us to explore how a holiday let mortgage could work for you.
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