Holiday let mortgages, until recently, were quite a ‘niche’ product. However, they are becoming a lot more popular now due to more and more people choosing Britain as a holiday hotspot. And as any financially savvy investor will tell you, a holiday let mortgage attracts more tax breaks than a traditional buy to mortgage, so buying a holiday home can prove to be a wise decision.

The holiday let mortgage is generally excluded from the standard buy to let mortgage schemes that are available. This is because the holiday home is generally seen as a business, which is how these tax breaks can be earned.

So what do you need to know when considering a holiday let mortgage? Well, as with most other mortgages, there are rules and guidelines that need to be adhered to when taking out a holiday let mortgage and when you finally own your holiday home.

Criteria for meeting the loan requirements do vary from lender to lender. However, generally speaking the maximum size which you are usually able to borrow will be down to the amount of rental income that you have coming in or will be assessed on rental and personal income.

With holiday home letting being classed as a business there are some tax benefits, however your holiday home must meet some basic requirements. Usually it will be considered a holiday let if it is furnished and is available for people to rent at least 140 days every year. You must also be able to let it commercially, as opposed to letting friends and family rent it cheap, for at least 70 days every year. Short term lets are usually a period of no longer than 31 days and you are not allowed to let the holiday home to the same person for longer than a period of 31 days in any year.

You will also be able to claim some expenses relating to the letting of the holiday home as a way to reduce the amount of tax you have to pay. The Inland Revenue will expect you to declare how much rental income you have made on your self assessment tax return.

While owning a holiday let can be very profitable, when it comes to starting out and getting a holiday let mortgage, it makes sense to visit a specialist mortgage broker. They can take the strain from your search for the ideal mortgage and provide invaluable help and advice along the way too.

Holiday Let Mortgages offers UK residents the finance to buy a UK based holiday home. The site offers a Free Guide to download for Holiday Home Mortgages and the process for buying a UK Holiday Home.

Source: www.articlesbase.com