Looking For Holiday Let Finance?
The rising popularity of the ‘staycation’ as a vacation choice along with potential tax and yield benefits have made holiday lets an increasingly attractive proposition for property investors.
Platforms such as Airbnb and HomeAway have changed where people stay when they are away from home. Many lenders are now starting to react to this new market by offering new and varied loan products.
But it is essential to understand that holiday lets don’t work everywhere. It is necessary to do your research when choosing a location as this will directly affect the income it generates. Local estate agents and lettings agents should be able to advise you of the pros and cons of buying or building a property in a specific area.
Can you help with my first holiday let property?
Yes, we are regularly approached by first-time investors either looking to buy their first holiday let investment property, converting a disused building or building one or more new holiday lets from the ground up. Either way, we have lenders who will lend to first-time investors as well as to more experienced and portfolio landlords.
Can I use my holiday let for my own holidays?
Not every lender will allow you or your family and friends to use the property for holidays. Those that do typically allow the property to be used for between 60 and 90 days per year.
How much could I borrow for a holiday let?
Mortgage providers typically lend a set percentage of the purchase price of a property. This percentage is known as the loan to value (LTV). The LTV on typical purchase or remortgage products is around 70 to 80%, and you will need to find the balance of the money in cash or as in the form of an asset that can be lent against. However, as a general rule, the higher the LTV, the higher the rate of interest charged and the more conditions may be attached to the loan by the lender.
Is it easy to raise finance?
There are far fewer lenders that offer mortgages for holiday lets as opposed to standard buy-to-lets. And holiday let finance does still have a reputation for being difficult to arrange. However, with a suitable property in the right location, a lender can usually be found.
It is also important to understand that holiday let, and buy-to-let mortgages are different financial products and should not be confused. A holiday let mortgage allows an investor to purchase a residential property that is then let on a short-term basis as holiday accommodation. In contrast, a buy-to-let mortgage is used to buy a residential property that is let for more extended periods, typically six months or more at a time. And swapping between lets with the same lender is rarely straightforward and is often impossible.
Although limited in number, holiday let lenders do still offer a range of very different terms and criteria. This can make the process of choosing the right lender a bit more challenging.
That is precisely where the services of a specialist broker such as Fusion Finance can make all the difference. Firstly, we bring expertise along with access to the wider lender market, including private banks and funds. Secondly, we aim to find you the best funding for your particular circumstances. Finally, our help and advice are impartial, in confidence and given without obligation.
At Fusion Finance we can help you finance:
- The purchase of holiday let properties
- The remortgaging of holiday let properties
- Building or refurbishing holiday let properties
How do I apply for holiday let finance?
Simply fill out our holiday let finance enquiry form below, and once we have reviewed it, a specialist will telephone you to clarify any details and take your application forward.
Once we have collected all the facts, we can then look to find the best finance product for your particular needs and circumstances. As soon as we have found the best loan and you are happy with the terms on offer we can proceed with your loan application. Finally, we will deal with the lender and keep you updated during the whole loan application process to completion of the loan.
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