Owning your own holiday home is an exciting opportunity, but first, you’ve got to finance it. Like with any house purchase, unless you have the whole sum to pay in cash, you’ll need to get a mortgage to pay for your new property. The type of mortgage you need and where you get it from will depend on how you intend to use the holiday home, and whether you’re buying at home or abroad.
Residential mortgages for UK holiday homes
If you’re buying a holiday home for your own use and don’t plan on renting it out to make money, getting a mortgage should be pretty simple.
You’re basically just taking out a regular mortgage, but if you already have a mortgage on your main residence it may be called a second home mortgage.
The only issue you’re likely to run into if you already have a mortgage is that the lender is usually stricter in its assessment of affordability criteria when you apply and will take into account the repayments on your first mortgage. With that in mind, you’ll probably need quite a hefty deposit and be subject to higher interest rates and fees than with a typical mortgage. Around 25% is the minimum deposit usually required when taking out a second mortgage.
You may also find that your choice of lenders is limited as not all providers offer second home mortgages.
Holiday-let mortgages for UK properties
If you plan on letting your holiday home out to others, then you’ll instead need a holiday-let mortgage. These types of mortgages are again fairly straightforward and a mortgage adviser can help you find the right deal.
Mortgages for holiday homes abroad
Getting a mortgage for a holiday home overseas is generally done one of two ways:
1.Borrowing from a UK bank
Many high street banks offer mortgages for overseas properties
2. Borrowing from a bank in the country where you’re buying the property
When arranging a mortgage in the country where the property is based, it’s likely that you’ll go through a specialist broker
Mortgages for homes in holiday parks
Unlike a traditional brick and mortar house, it’s pretty impossible to get a mortgage on a holiday home in a holiday park. This is because the land they stand on is owned by the site owner, not the residents.
When you buy a static holiday home with us here at Encore Parcs, we require a deposit to secure your home and pitch site and the full balance of your holiday home is due 7 days after the deposit has been paid. If you’d like to learn more about our prices and financing your holiday home, please speak to one of our advisors who would be happy to discuss your options.
Take a look at our range of homes across our holiday parks in Northern Ireland – your dream holiday home is waiting for you!