Holiday Let Mortgage for Four Holiday Cottages

Purchasing holiday accommodation as a business requires the right funding and a well-prepared plan. Specialist lenders want to see that the investment is both commercially viable and capable of generating sustainable rental income.

In this case study, Positive Commercial Finance arranged a Holiday Let Mortgage that enabled our clients to purchase four holiday cottages in Wales as they prepared for retirement.

The Opportunity

After many years of work, our clients wanted to slow down without retiring completely.

They had previously stayed at a holiday cottage in Wales and, when it came onto the market alongside three neighbouring cottages, they saw an opportunity to create a holiday letting business in a location they already knew and enjoyed.

Although they had built up savings and could access pension funds, they wanted to finance part of the purchase while preserving capital for the business.

The Challenge

The clients had limited experience operating holiday lets, which meant lenders needed reassurance that the investment would generate sufficient income.

To secure competitive finance, we needed to demonstrate:

• A realistic business plan.
• Credible financial projections.
• Strong evidence of local rental demand.
• Long-term affordability.

Presenting a well-supported application was essential to give lenders confidence in a first-time holiday letting business.

Our Solution

We approached lenders specialising in holiday let mortgages and discussed the proposal before submitting a full application.

Working closely with the clients, we helped prepare a detailed business plan and financial forecasts. We also obtained supporting evidence from an established holiday letting agency to verify the expected rental income.

This combination of financial planning and independent market evidence gave the lender confidence to support the purchase.

Deal Structure

• Loan to Value (LTV): 70%
• Loan Amount: £450,000
• Interest Only: 10 years
• Interest Rate: 3.99% above Bank Base Rate
• Arrangement Fee: 0.75%

The Result

The lender approved a £450,000 holiday let mortgage against a combined purchase price of £650,000.

The interest-only structure reduced monthly repayments and helped preserve cash flow during the early years of the business.

Our clients are now able to begin their retirement with a new income-generating venture, supported by specialist holiday let finance designed to suit their long-term plans.