Holiday let – a Q&A with Chris Thompson

Chris Thompson, National Account Manager, recently joined the Knowledge Bank holiday let criteria clinic. There were lots of interesting holiday let topics and scenarios discussed. Below is a reminder of Chris’ response to some of the key questions from the event.

If you have any more questions for Chris or would like to find out more about our holiday let mortgage solutions, please call 07885 933595 or email cthompson@mhbs.co.uk. Alternatively you can visit our holiday let page to find out more about our current range.

Where do MHBS lend?

We lend on properties based in England and Wales. 

What are the min/max size loans?

We lend from £200k to £5m.

Do MHBS consider both regulated and unregulated holiday let cases?

Yes, our mortgage solutions are suitable for both unregulated and regulated holiday let cases.

A holiday let is classed as regulated where the applicant intends to reside in the property for more than four weeks a year. A regulated loan also applies if they plan to let the property as a holiday home in the short term before eventually moving in themselves.

We also offer residential products with consent to holiday let for up to 24 weeks a year.

How do MHBS consider affordability in relation to holiday lets?

Unregulated cases – are assessed on interest coverage (ICR) from gross rent based on the holiday let income as projected by a suitable agent local to the property. This is based on a 30 week average.

Regulated cases – are assessed on full affordability including the rental income in the assessment.

We look for a minimum £35k income for onshore applicants, and £45k for offshore applicants, alongside the let income.

For cases where the ICR falls below the minimum required, we can consider top-slicing and taking into account your client’s own income.

What holiday let scenarios where MHBS can help?

We provide solutions for simple holiday let cases as well as those with more complex factors, these might include:

• Expats/foreign nationals
• First time buyers/first time landlords
• Applicants looking to borrow into retirement
• Non-owner occupiers

We also consider more complex property cases:

• Multi-units (usually up to three max)
• Annexes
• Grade II listed buildings
• Large acreage

Will MHBS consider Airbnb holiday lets?

Yes, we approach Airbnb lets in the same way as other holiday let cases. There is no additional criteria, specific to these types of cases.

What is the MHBS approach to the borrower wishing to stay in the holiday let property?

For unregulated holiday let cases, the applicant can spend up to four weeks per year in the holiday home.  The home must be available to let out for a minimum 210 days per year, fully furnished.

How can I submit a case to MHBS?

If you’re already registered with MHBS, please get in touch with your Specialist Business Development Manager to talk about submitting your case or log into the Case Hub.

To talk about registering with MHBS or to find out if your firm/network is already registered, please get in touch.

What can I expect from MHBS?

We pride ourselves on providing quality mortgage solutions combined with personal service.

We’re delighted that almost all intermediaries who review us on feefo give us a five-star rating, the highest possible score.

For the second year running we have received the feefo Gold Service Award! To see our feedback click here.

Article details are correct as at 21 March 2023. For our latest product information and criteria please talk to your Specialist Business Development Manager.