With holidays on the horizon, the idea of generating extra income by letting your home while you’re away might be tempting. Platforms like Airbnb and Booking.com make it seem straightforward. However, it’s vital to understand the potential implications for your mortgage and insurance before listing your property.
Mortgage Lender Permissions:
Many residential mortgages in the UK have clauses that restrict or prohibit letting your property without the lender’s explicit permission. This includes short-term lets through platforms like Airbnb. Lenders have varying policies; some may allow it under specific conditions, while others may not.
- Action Point: Review your mortgage documentation carefully. If you’re unsure, contact your mortgage lender to discuss your intentions and get clarity.
- Our Role: As your mortgage broker, we can provide guidance on navigating these discussions. Please get in touch if you need assistance.
Tax Implications:
Generating income from short-term letting can have tax implications. You may be liable for income tax and National Insurance contributions, depending on your earnings.
- For detailed information on tax obligations, refer to the official government guidance:
- GOV.UK: “Renting out a property: Paying tax” (https://www.gov.uk/renting-out-a-property/paying-tax)
- Recommendation: If you have specific tax queries, it’s advisable to seek advice from a qualified tax advisor – we cannot give tax advice.
Home Insurance Considerations:
Your existing home insurance policy may not cover short-term letting. Contact your insurer to discuss your plans. They may require you to take out specialist cover or adjust your current policy.
- Action Point: Discuss your short-term letting plans with your home insurance provider before listing your property.
Key Considerations Summary:
- Mortgage Lender: Always obtain permission from your mortgage lender before letting your property.
- Tax: Understand your tax obligations and seek professional advice if needed.
- Insurance: Ensure you have adequate insurance coverage for short-term letting.
Let’s Chat
Our team of expert mortgage advisors is here to help you understand the implications and find the most suitable mortgage for your circumstances. We work with a comprehensive panel of lenders to explore all available options and, importantly, we don’t charge broker fees. Contact us today for a no-obligation discussion and let us guide you through the process.
Your home/property may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.
We do not charge a fee for mortgage advice.
Think carefully before securing other debts against your home or property. The Financial Conduct Authority does not regulate some forms of Buy to Lets.
Disclaimer:
This information is for general guidance only and does not constitute financial or legal advice. Regulations and lender policies can change. Always seek professional advice tailored to your individual circumstances.
The information provided in this article, including text, graphics and images does not, and is not intended to, substitute advice; instead, all information, content, and materials available in this article are for general informational purposes only. Information in this article may not constitute the most up-to-date legal or other information.
Please be aware that by clicking on to any of the above links you are leaving our website. Please note that neither we nor HL Partnership Limited are responsible for the accuracy of the information contained within the linked site(s) accessible from this page.
At Yes Mortgage Services, we offer a comprehensive range of products from across the market.
Irrespective of whether you are looking to buy a new home, re-mortgage an existing property, or looking to protect your family from the unpredictability that life throws at it or protect your income if you are unable to work due to accident or ill health.
Yes Mortgage Services are committed to offering you the highest possible standards of service. We can undertake the whole process from answering the initial questions through to handling multiple product applications. Ensuring that everyone gets treated with the same urgency and maintaining your best interests are our main goals irrespective of the value of the mortgage.
We recognise that both we and our customers have everything to gain if we look after your best interests and treat you fairly in all aspect of our dealings with you.
