Ipswich Adds New 80% LTV Vacation Rental Mortgage to Buy-Lease Offer
The new two-year fixed rate mortgage has a rate of 4.10% and provides borrowers with 60 days of personal use of their property. It is calculated on the basis of an average rental income in low, medium and high season.
Richard Norrington, CEO of Ipswich, explained that while demand for vacation rentals has been high in the buy-to-hire industry, product selection has been inconsistent throughout the pandemic. As such, the construction company wanted to expand its offer in this area.
He said: ‘The pandemic has led to an increase in the number of stays in 2020, and with popular UK holiday destinations already booked for this summer, it is expected to continue into 2021 and beyond, particularly with foreign travel rules currently unknown.
“It is perhaps not surprising then that there is a demand in the seasonal rental market for vacation rentals. However, as the appetite for these mortgages increases, the number of vacation rental products has fluctuated throughout the pandemic.
“While we were already currently in the vacation rental market with preferential rates, we wanted to meet the demand for packages. By increasing our offering here, we hope to provide more options for those looking to buy or remortgage a vacation rental, especially those looking to do so with a smaller deposit.
The two-year fixed rate vacation rental product is priced at 4.10% until March 31, 2023 and then reverts to SVR (currently 5.24%). It is available at 80% LTV with a minimum loan of £ 75,000, a maximum loan of £ 500,000, an application fee of £ 199 and a completion fee of £ 950.
All products have a CHAPS fee of £ 35 and a tiered appraisal fee based on property value applies. Remortgage seekers receive a free assessment and access to fee-based legal services.
During the initial term of the mortgage loan, the building society offers free overpayments of up to 50% of the original loan amount.