Holiday let mortgages

Got a client with a seaside escape or a spot in a national park? If you’re client has a genuine holiday destination with strong rental demand, we’ve got the mortgage to match.

Key highlights

Loans from £400,000 to £20 million 
Loan to value up to 75%
Fixed rates
Loan terms from 5 to 25 years
Capital and interest, part and part and interest only.

Holiday Let mortgage rates

Holiday Let mortgage criteria

Lending criteria

Type of borrower

Sole traders.
Limited companies.
Limited liability partnerships (LLP).
Individuals and partnerships.

Eligibility

Company registered in England and Wales. 
All the shareholders and directors must be UK residents. 
The company does not need to have a business account with us.

Capital raising purposes

Purchasing another property.
BTL operational purposes.
Property improvements (not including structural or development).

Affordability

Gross rental Income Cover Ratio (ICR) of 125% at the product stress rate.


The customer should be able to demonstrate an ability to bridge any difference between potential AST income and stress tested holiday let affordability.


Must meet 100% Debt Service Cover Ratio (DSCR) if on capital and interest repayment.

Evidence required

Rental income via financial accounts, Tax Overview Statement, bank statements or a Letting Agent declaration of likely rental income for the next 12 months.
A holiday let rental estimate will also be requested from the valuer.

Maximum loan per block or property

£1.5 million.

Maximum committed term

Up to £2 million: 25 years.
Over £2 million: 10 years.

Asset criteria

Type of property

Must meet Decent Home Standards and be:
houses
flats
bungalows
multi-unit freehold blocks (MUFBs).

Location

Must be in a genuine holiday destination. For example, affluent coastal location, popular tourist city centre and national parks.

Minimum value per property or unit:

£135,000.

EPC rating

A to C (or D/E with plan to get to C).

Tenancies

Short term furnished let of no more than 31 consecutive days to the same people.

Legal charge

A first legal charge is required.

Personal guarantee

£175,000 or 10% - whichever is higher, from one or more directors.

Valuation

To be completed by a YBS panel valuer and lending based on the lower of:
purchase price
open market vacant possession
investment valuation.

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