Please Note: The information included within these pages is for for use by FCA authorised intermediaries only. If you are a customer please visit our customer web pages.

Lending Criteria

Criteria Standard Product Non-Standard Product
1. Annual income above £20,000

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2. Annual Income below £20,000* -

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3. Applicant is an individual or partnership

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4. Applicant is a Company or LLP (SPV)*

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5. Applicant is a Company or LLP (Existing Trading Company)* -

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6. Loan amount above £75,000

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7. Applicant is a UK resident* - -
8. No occupancy restrictions apply

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9. Occupancy restrictions apply -

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10. Proposed holiday letting is based upon proven letting figures or projected figures*

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11. Top slicing of background income required to meet shortfall at stressed rate (or pay rate if 5-year-fixed) -

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12. Portfolio landlords and non-portfolio landlords

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13. Some or all of the funds requested are to be used to raise capital for the improvement/refurbishment of the property or to replenish funds used for those purposes

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14. Some or all of the funds are to be used to purchase or renovate another property

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15. Some or all of the funds requested are to raise capital for injection into another business venture (including but not exclusively property development) -

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16. Funds to be used to consolidate debt of £25k or more -

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17. Applicant owns a residential property

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18. Applicant does not own a residential property -

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19. The HMLR title includes just a single letting unit

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20. The HMLR title includes up to 3 letting units -

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21. Applicant is an expat (lending subject to geographical location) -

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* Relating to the numbered criteria only

1,2. Background income can be used to top slice where the stress rate hurdle is not met (see below for stress criteria details) and the borrower must demonstrate the ability to service the debt from background income or other sources.

4,5. Companies must be incorporated in the UK. Standard pricing available for simple SPV company structure.

6. Maximum exposure on standard products £2m. Maximum aggregate exposure £5m.

7. Borrowers must be a resident in the UK, or a British expat.

10. Viability calculation based on annual rental income of property after 20% deducted for letting agent fees; Loans must meet a stress hurdle of 125% interest cover at an interest rate of 5.6% where the product rate is variable; 5 year fixed stressed at 125% at pay rate; HL income must be confirmed in writing by a reputable letting agent or from actual trading figures from current property owners.

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Lending Criteria

  • Our Holiday Let Mortgage criteria
    Maximum LTV

    We can lend up to 75% of the property value

    Loan size

    The minimum loan size is £75,000

    The minimum property value must be £100,000

    Mortgage products displayed above apply to loans of up to £2m. For loans of over £2m, please call our team on 01228 403 312 to discuss the products available to you.

    Term

    Maximum mortgage term is 25 years

    Property

    Leasehold properties should have a minimum of 85 years left on the lease at the start of the mortgage and 50 years on maturity

    Our product rates for are available for both new and established holiday let properties

    Single or multiple unit properties acceptable

    Properties which are temporary or moveable are not eligible

    Rental coverage

    To meet our criteria for rental coverage, annual net rental income (we assume 80% of the gross figure) must:

    • For 2 year fixed, 2 year variable or 5-year fixed rate products be a minimum of 125% of the annual mortgage interest at the product fixed rate
    • For standard variable rate products - be a minimum of 125% of the annual mortgage interest at an interest rate of 5.6%
    Accessible cash savings A minimum of £15k* cash savings held after the mortgage has completed should be evidenced.

    *A higher balance may be required subject to loan amount.

  • Standard Products

    To qualify for standard products, a case must meet ALL criteria, otherwise non-standard products apply.

    • Annual personal income above £20,000
    • Applicant is an individual, partnership or Ltd company(SPV)1
    • Loan amount above £75,000 2
    • Applicant is a UK resident
    • No occupancy restrictions apply
    • Proposed holiday letting is based upon proven figures or projected figures
    • Portfolio landlords and non-portfolio landlords
    • Some or all of the funds requested are to be used to raise capital for the improvement / refurbishment of the property or to replenish funds used for those purposes
    • Some or all of the funds are used to purchase or renovate another property
    • Applicant owns a residential property
    • The HMLR title includes just a single letting unit
    1 Beneficial owners of Ltd Companies to be EU Nationals resident in the UK. Companies must be incorporated in the UK.
    2 Maximum exposure on standard products £2m. Maximum aggregate exposure £5m (eg £2m standard; £3m non-standard).
  • Non-Standard Products

    In the following circumstances, non-standard products apply:

    • Annual income below £20,000
    • Applicant is a Trading company or an LLP1
    • Occupancy restrictions apply
    • Top slicing of background income required to meet shortfall at stressed rate (or pay rate if 5 year fixed) 2
    • Some or all of the funds requested are to raise capital for injection into another business venture (including but not exclusively property development)
    • Funds to be used to consolidate debt of £25k or more
    • Applicant does not own a residential property
    • The HMLR title includes up to 3 letting units
    • The property sits above a commercial property (eg a flat above a shop)
    1 Beneficial owners of Ltd Companies to be EU Nationals resident in the UK. Companies must be incorporated in the UK.
    2Viability calculation based on annual rental income of property after 20% deducted for letting agents fees; Loans must meet a stress hurdle of 125% interest cover at an interest rate of 5.6% where the product rate is variable (e.g. a loan of £100k must have nett income of £7,000 to meet a stress rate of 5.6%). 5 year fixed stressed at 125% at pay rate. HL income must be confirmed in writing by a reputable letting agent or from actual trading figures from current property owners.

    Background income can be used to top slice where the stress rate hurdle is not met and the borrower must demonstrate the ability to service the debt from background income or other sources.