Airbnb Mortgage

Understanding your mortgage options to become an Airbnb host

How to get an Airbnb Mortgage?

Airbnb has gone from strength to strength in recent years and it has never been easier to let out a property to holidaymakers. If you are interested in investing in a property for that very purpose, you may be wondering what sort of mortgage for Airbnb property is going to be the most suitable for you. Here’s everything you need to know…

Can you get a mortgage for an Airbnb property?

Yes, Airbnb mortgages are available to those looking to purchase a property for the purpose of becoming an Airbnb host in the UK. Nevertheless, there are important factors you must consider:

  • For how many weeks during the calendar year is your property going to be available for rent on Airbnb (approx.)?
  • Do you already have a mortgage with an existing lender? If so, you may need to get their ‘consent to let’ before you become an Airbnb host.
  • Do you want to make the full property available to rent out or are you only going to make one or several rooms available?

These points vary from lender to lender, which is why specialist assistance is so critical, and that is exactly what we are here to help you with. 

Pat TalbotPat Talbot
16:34 04 Apr 22
A professional company with a personal touch. It was good to speak with an advisor who not only listened patiently whilst we explained our problem, but relentlessly sourced a wide range of options with speed, care and attention to detail.
Claire HillyerClaire Hillyer
19:54 28 Mar 22
Since 2016, Mark has supported us in finding two affordable mortgages and (importantly) ones that have been just right for our needs. He has always listened to our requirements and helped us to explore different options. Mark has a caring nature and we’ve appreciated him guiding us through what could have been a stressful process. We would recommend him to anybody.
Elaine ReaderElaine Reader
19:23 20 Dec 21
Having entered the house-buying process with some trepidation, given our circumstances (self-employed, etc.), we cannot be more grateful for the superb service provided by Joe and Ben at HHH. They were always easy to contact, friendly, helpful, and took time to explain everything to us. The whole experience was notable for a level of care and attention to detail rarely seen.We cannot recommend them highly enough.
Paul JohnPaul John
14:03 01 Dec 21
A seamless, professional service, from start to finish. HIghly recommended. Mark took the time to understand our exact needs and matched us with the ideal product at a very competitive rate.
Annabelle MilesAnnabelle Miles
13:46 17 Nov 21
Brilliant service as always – Mark is a delight and answered all our questions about our remortgage swiftly!
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WHAT TYPE OF MORTGAGE IS MOST APPROPRIATE?

A holiday let mortgage is often best in this situation. These are mortgages designed for properties to be rented out on a short term basis with new mortgage products being available with Airbnb hosts in mind. 

Holiday let mortgage applications are reviewed based on the commercial potential of the property and the Airbnb income that can be derived. 

I ALREADY HAVE A RESIDENTIAL MORTGAGE, CAN I BE AN AIRBNB HOST?

It is possible, however, you must get in touch with your current lender and inform them of your intentions. This is important because most lenders require their consent for an Airbnb-type letting. 

Most lenders deem renting out your entire property on Airbnb a breach of the contract rules. This is because residential mortgages have been designed so that these properties are used as your main residence in the UK, rather than an investment property to make money from in the rental market.

If you plan to rent an entire property out, you may be required to change your mortgage to a buy-to-let or a commercial mortgage for Airbnb. Fortunately, this is something that we can help you with.

If you aim to rent out only one of the rooms in your home using the Airbnb platform, most lenders deem this as being similar to taking in a lodger, and so the likelihood is that this may be permitted. Again, this is something that we would be more than happy to advise you on. 

I ALREADY HAVE A COMMERCIAL MORTGAGE, CAN I BE AN AIRBNB HOST?

As the name indicates, a commercial mortgage is designed for the purpose of borrowing money for a commercial property that is used for day-to-day business activity. As such, Airbnb hosts can only use these sorts of mortgages in very specific situations.

For a professional landlord that has a big portfolio of property, you may be able to find a lender that is willing to consider a commercial mortgage for a property that you intend to let out on Airbnb. However, this does depend on the strength of your application, which is why it is important to work with a professional Airbnb mortgage advisor who can help simplify the process.

GETTING THE BEST MORTGAGE RATE FOR YOUR AIRBNB LISTING

There are a number of steps that you can take to increase your chances of securing the best possible rate on Airbnb mortgage loans, but first you need to understand the different factors that can influence your interest rate.
  • Property type: every lender is different, but you should note that some lenders do not accept listed, unique, or non-standard properties. This is because these types of property tend to be high risk as they may be difficult to sell in the future.
  • Deposit size: generally speaking, the bigger the deposit you can offer, the better rate of interest you will receive on Airbnb mortgages. This is largely because it provides more comfort and security for the lender.
  • Credit history: if you have a poor credit history, securing a mortgage will be significantly harder. While you may be offered a deal, even with bad credit, the rate will likely be much higher.
If you are feeling overwhelmed, please feel free to contact us today and we can offer you the best advice based on your personal circumstances.  

HOW DOES AIRBNB LISTING AFFECT MY EXISTING MORTGAGE?

Again, you should always contact your lender and inform them if you already have an existing residential mortgage and you are thinking about becoming an Airbnb host. You may need to prove that your intention originally was to live in the property, rather than rent it out. In most cases, lenders will prove consent to let in exchange for an arrangement fee.

Additionally, they may decide to raise the rate of interest. It’s important to note that you could be in breach of the terms and conditions of your contract if you make the full property available on the Airbnb platform. In this case, the lender may ask that you repay the loan in full, so it is never worth the risk.

Mark has been such a great support all the way through the mortgage process. He is helpful, friendly and always on hand to give advice. It is no exaggeration to say we wouldn’t have purchased our holiday home without him as many other brokers gave up on finding a lender happy to invest within a holiday estate. We will definitely be recommending his services to our friends and family and we will not hesitate to use him again in the future. Thanks Mark!

Vicki P - Cotswolds