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Holiday Let Mortgages 80 LTV


Holiday Let Mortgages 80 LTV
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Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

Almas Uddin21 Dec 2023
    

How Can I Finance the Purchase of an Airbnb Mortgage?

For a long time, many conventional mortgage lenders would not consider financing the purchase of an Airbnb property. This was largely due to the legal complications surrounding such buy-to-let properties, as well as the seasonal fluctuations in income that these ventures involve and the elevated maintenance costs associated with the operation of this type of business.

Axis Bank are the first institution to have proposed a solution to the problem but stipulate that all applicants seeking to purchase an Airbnb property must already be in possession of at least three other buy-to-let assets. Furthermore, their products are only available in certain parts of the UK, meaning that plenty of buyers have been left with no recourse.

Fortunately, an established mortgage provider has recently indicated that they plan to launch a new product catering specifically to the ever-growing Airbnb market. This is exciting news for a number of reasons, given that there are no minimum income requirements, the provider adopts a pragmatic stance when it comes to marginally chequered credit history and caters to both personal applicants and those belonging to a limited company.

Holiday Let Mortgages 80 ltv

The mortgages will be available with a loan-to-value (LTV) ratio of up to 75%, while interest rates start from just 2.99% (5.1% APR). All that is required to qualify for this attractive opportunity is that all applicants must already own at least one other buy-to-let property and that the property for which the loan application is being made can only be used for holiday let mortgages 80 ltv or Airbnb mortgage purposes.

However, buyers interested in the deal should be aware that the maximum amount available will be determined based upon an assessment of the rental income that the Airbnb property would garner if it was let on a conventional assured shorthold tenancy (AST). Since this normally attracts lower rental rates than a holiday let mortgages 80 ltv or Airbnb mortgage property, it’s likely that the total amount available to the borrower may be less than they might have expected.

However, it does offer the silver lining that if the property does not perform as well as predicted in the holiday let mortgages market (for whatever reason), the borrower has the option to fall back onto the AST market as a safety net. With one mortgage provider has opened up the market for Airbnb property buyers, it’s likely that many more will follow their example in the coming year.

If you’re interested in sourcing a mortgage brokers for an Airbnb property in the near future, why not get in touch? We can walk you through all of the providers and products available to you, discussing your options in full and allowing you to make an informed decision.

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FCA disclaimer

The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature.

We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.