Can I get a mortgage for my Airbnb property?
YES. The mortgage industry is slowly coming around to accepting mortgage applications that are intended to be used for Airbnb purposes. High street mainstream lenders may be struggling to keep up with this growing trend, our advisers have access to lenders that specialise in lending for this purpose.
This means that if you have access to the right adviser, it’s easy to find an Airbnb mortgage lender in the UK market.
Many of the specialist lenders are adapting quickly to the growing Airbnb mortgage market, and our advisers have access to some of the most flexible.
If you are looking to find a great mortgage deal with the right lender who understands your requirements, then your recommended adviser can help. It worth remembering that using your property for letting without your current mortgage lenders permission could place you in breach of contract, contact us today and we will put you in touch with a qualified adviser who can provide you with some no-obligation advice.
For more information on how the UK mortgage lenders approach Airbnb applications, and what it could mean for you, please read on.
Can you get a mortgage for Airbnb?
One of the most common questions on the Airbnb forums is “can I get a mortgage for Airbnb?”
The very quick answer to that question, is YES, you can. There are certain aspects, rules, and criteria you need to be aware of before taking out a home loan including a buy to let mortgage, and this is where a qualified adviser can help.
There have been a number of stories where the UK media have reported on property owners being in breach of their mortgage contracts due to renting out rooms and entire properties on the Airbnb platform, without the prior permission of their mortgage lender.
In theory, should you breach your mortgage term, your existing lender could ask you to repay the entire loan balance immediately, or they may increase your interest rate or apply penalties in other ways. Whilst different lenders will enforce a breach of terms in different ways, the property owner will have the obligation of rectifying a breach as soon as possible, this may mean switching their mortgage to another lender.
This is where the advice of a qualified professional adviser could be invaluable.
How the traditional lenders compare
With that in mind, how do the high street lenders compare when it comes to allowing for Airbnb mortgages?
Here are just some examples from a few of the big-name lenders and how they differ in their approach to Airbnb rental properties or room lets.
| Lender Name | Can you rent a room on Airbnb? |
|---|---|
| Barclays | No |
| HSBC | No |
| Lloyds | Yes, to a maximum of 4 months annually |
| Metro Bank | Yes, to a maximum of 3 months annually |
| Nationwide | No |
| Royal Bank of Scotland (RBS) | Possibly, but with prior consent |
| Santander | Possibly, but with prior consent |
| Virgin Money | Possibly, but with prior consent |
| Yorkshire Building Society (YBS) | No |
The above stated criteria correct as of 1st October 2018 and is subject to change.
Mortgage lenders who allow Airbnb
The high street lenders won’t always allow for Airbnb lettings and rentals. Airbnb is a specialist sector that requires a specialist approach. We will recommend a qualified adviser who has access to a panel of specialist lenders who understand the Airbnb model and the requirements of the owners.
If you are generating an income from Airbnb, it should be possible for our advisers to find a lender who will accommodate you.
Can you get a mortgage on your Airbnb rental income?
YES. Once a suitable lender is found, they will look to assess your affordability and will treat your application in a similar way in which they offer home loans to buy to let owners.
You will be required to provide proof of income including:
- Proof of lettings income. This could be via bank statements.
- SA302 year-end tax calculations
Our specialist mortgage advisers can help you to put together an Airbnb mortgage application that considers any form of income outside of traditional payslips.
Does Airbnb affect your mortgage?
Using the Airbnb website to let out rooms in your home or entire second properties is a growing trend in the UK. There’s no doubt that it can be a very lucrative business to be in, but it can cause issues with your existing mortgage lender.
Renting out rooms in your house, or completely letting out a property you own in its entirety is made simple with Airbnb for short-term rentals.
But you should be cautious, if you have an existing mortgage on your house then you must inform your mortgage company, and lenders will vary on whether they are willing to grant permission.
In many instances your mortgage agreement will have a contractual term which excludes you letting your property without express prior consent.
Therefore, if you offer your property for rental under the Airbnb service, you could be in breach of your mortgage contract.
- Some mortgage lenders will increase your interest rate if you are going to be renting out your mortgaged property.
- Some mortgage lenders will refuse you letting your property or rooms completely.
- Some mortgage lenders will allow you to rent out a room on a short-term basis only.
As you can see, the responses you will get will vary depending on who you have your mortgage with.
There are also other considerations to think about outside of whether you are in breach of your mortgage rules including:
- Your home insurance policy might not cover short-term lets.
- You home insurer might request that you pay more in monthly or annual premiums.
- You will be required by law to declare any rental income to HMRC
You should not proceed with an Airbnb rental property or room without notifying your mortgage lender, insurer, and the local authority.
If you are letting out your property without the permission of your mortgage lender, it could be time for you to make a switch to an Airbnb mortgage lender.
To find out more and to be referred to a qualified adviser for specialist advice, contact us today.
Our advisers can help you navigate through the complexities of an Airbnb mortgage, whether that means updating your existing agreement, getting a buy to let, or re-mortgaging for more preferable terms.
Do you need a buy to let mortgage for Airbnb?
There are certain lenders who will let you borrow on a buy to let basis with the intention of renting via the Airbnb website.
And for homeowners looking to rent out rooms in their home, you should notify your existing mortgage lender of your intention to do so.
By informing your mortgage lender of your intentions to let rooms via Airbnb, it means you will be getting the correct information on whether you are breaking any contractual terms on your existing mortgage deal.
Our advisers can help you find an Airbnb mortgage lender who could be prepared to offer you a buy to let deal as an investment opportunity.
What to do next?
If you want to find a mortgage that lets you rent via Airbnb, re-mortgage for an Airbnb investment, or find a buy to let deal to suit, contact us today. Your specialist adviser may be able to offer you a better deal than the one you are already on?
Our advisers will search a specialist panel to find a lender that is prepared to be more flexible in offering you a mortgage based on income from various different sources.
Our advisers have many years of experience in helping to place clients with mortgage lenders who are prepared to work in non-traditional scenarios.
