Can You Take Out A Mortgage To Purchase A Holiday Lodge?


Posted on: 18 April 2016 by James Brockbank

Looking to purchase a holiday lodge? We take a look at whether or not they can be financed with a mortgage.

Holiday lodges are rising in popularity as an affordable way to enjoy a luxury holiday right here in the UK, thanks to their desirable locations and fully furnished modern interiors.

There are now around 7,500 of these lodges in the UK, with prices starting at around £60,000.

But how do you go about financing one of these lodges? The purchasing of a holiday lodge is quite different to that of a bricks and mortar property.

So can you get a mortgage on one of these holiday lodges? The straightforward answer is no, but while you can’t get a traditional mortgage, there may be other options available to you.

A traditional mortgage is secured against the property’s listing on the land registry, however with a holiday lodge you technically don’t own the land that it is situated on.

Instead the land is owned by the park owner and is simply leased to you, so you’ll be unable to secure a mortgage.

However, there are specialist lenders who deal exclusively in park homes and holiday lodges.

They can usually finance you for up to around 80% of the property’s value, with loans available for up to 15 years, and deposits of around 25%-30%.

As for interest rates, these will vary depending on your own circumstances and how much you’re borrowing.

It’s important to note that these loans are not mortgages, and are, in many ways, simply personal loans.

You could also choose to finance a holiday lodge by remortgaging another property if there is enough equity.

So while you technically can’t take out a mortgage on a holiday home, there are finance options available.

If you are looking to purchase a holiday lodge and are unsure on how to go about it, and whether you’ll be able to secure finance, get in touch with a professional body such as Sell My Lodge who will be happy to advise you.

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