 Holiday
home mortgages
Holiday home mortgages are mortgages
to buy or refinance a holiday home or second
property. This means that the mortgage company
do not expect the property to be let out. This
is perfect if you want a weekend retreat in the
country that only your family and select friends
will use.
If you would like a second property but also
want to let it to paying holidaymakers then you
need a holiday let mortgage. A
holiday let mortgage is different to a
holiday home mortgage because it is specially
designed for properties that will be let out to
holidaymakers.
You will find that lenders treat these 2 types
of mortgage very differently. With a holiday let
mortgage they will be looking for the rent to
cover the mortgage payments by a certain
percentage, typically 130% to 150%. If it
doesn't then some lenders will take additional
income from you the borrower to make the deal
look attractive. Also a holiday let property can
have a restriction on how the property can be
occupied. This essentially means you will be
unable to live in it permanently as it has to be
let for part of the year. This restriction makes
reselling the property slightly more difficult.
A holiday home therefore should not have this
restriction as most lenders will not accept it.
Make sure you take care to check first before
committing solicitors and surveyors as a mistake
could be very costly.
With a holiday home mortgage the lender need to
see that you can afford this loan together with
any others. If you have other buy to let
mortgages then they tend to be excluded as they
are self financing. |
