Our holiday let mortgage criteria outlines the requirements landlords will need to meet for us to be able to offer them a mortgage. This can cover the size of the deposit, the type of property, how we assess affordability and much more.

We have broken down some of this criteria in our Frequently Asked Questions to help you understand the main points.

We require a minimum age of 25 years to be able to apply for our holiday let mortgages and the mortgage needs to be repaid before age 85.

We also have a maximum mortgage term of 40 years.

Yes, we require a minimum income of £35,000 to qualify for our holiday let mortgages. Landlords must also be owner-occupiers on a residential property.

Furnished holiday let mortgages are holiday let mortgages where the property qualifies as a furnished holiday let under HM Revenue and Customs (HMRC) tax rules.

HMRC have a definition for furnished holiday lets because these have special tax rules. You can find out more here. We only lend on properties that can qualify as a furnished holiday let under the HMRC definition.

We typically ask for a minimum 25% deposit for a holiday let mortgage. This means we can lend up to 75% loan to value (LTV) of the property price.

Subject to product availability, we can offer fixed rate or discounted variable rate mortgages for holiday let mortgages. We also allow capital repayment or interest only holiday let mortgages.

Please check our individual holiday let mortgage products for full features.

We can accept limited company holiday let mortgages for purchase or remortgage, subject to product availability.

Properties used for holiday lets must have a minimum property value of £200,000 and qualify as a Furnished Holiday Let under HM Revenue and Customs (HMRC) definition. Lending on holiday parks or complexes, B&Bs, and properties subject to title, local or occupancy restrictions are excluded.

Our holiday let mortgages are currently available on properties located in England and Wales

We will need Low, Mid and High Season rental figures for the property from a letting agent or valuer. We will then use an annual average of the 3 seasons’ income, after the agent’s letting fees have been deducted (or 20% of gross rents if this is not confirmed) to get an estimate of the overall annual income from the property.

To find out if the income can cover the monthly mortgage payments, we’ll calculate the estimated monthly income based on 70% of the annual average (to allow for potential rental voids). This figure must be at least 125% of the monthly mortgage payment calculated at 6.5% or 2% above the product pay rate (whichever is higher) on an interest only basis.

We can also accommodate background income or other earned income to help meet a shortfall in rental income on one property per landlord, this is something known as Top Slicing. When Top Slicing is used, the estimated monthly income must be at least 100% of the monthly mortgage payment calculated at the product pay rate.

Our holiday let mortgage rates are provided on our mortgage product webpages. You will see two rates, the Initial Rate and an Overall Cost for Comparison.

The Initial Rate is the rate available during the initial term of the mortgage. Once that initial rate term has expired, the mortgage will revert to our Standard Variable Rate (SVR), which is set by us.

The Overall Cost for Comparison is given as the Annual Percentage Rate of Charge (APRC) and includes all charges relating to the mortgage over the overall mortgage term, including any time on our SVR and not just the initial term. The full cost, including all charges relating to the mortgage, is shown in detail on each product as a Representative Example.

Prior to the expiry of the initial term, we do write to borrowers informing them of the impending reversion to our SVR. At this point, we advise them of the new rate and, where possible, offer a new fixed rate or discounted rate deal.

During the Initial Rate period it is likely that an Early Repayment Charge (ERC) will apply if you choose to leave us and go to another lender or repay more than 10% of your mortgage or pay off your mortgage in full. Borrowers on our SVR can leave us or repay their mortgage without charge.

Yes, we offer Expat Holiday Let mortgages on specific mortgage products. As well as needing to qualify for our holiday let criteria, applicants will also need to meet our Expat Buy to Let lending requirements.

You can find out more about our Expat Buy to let criteria on our website here.