Second Home Mortgage Rates

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Pete Mugleston

Author: Pete Mugleston

Mortgage Advisor, MD

Jon Nixon

Reviewer: Jon Nixon

Director of Distribution

Updated: March 15, 2024

How we reviewed this article:

Our experts continuously monitor changes in the financial space and work closely with qualified mortgage advisors for factual verification.

March 15, 2024

If you’re looking at getting a second home mortgage and want to know more about current interest rates, here we outline why things are different, how to go about finding the best deals, and which mortgage lenders are offering what right now.

What is the current interest rate for a second home mortgage?

Mortgage rates on second homes aren’t usually any higher than they are for mortgages on primary residences. With this in mind, you should expect to see the best deals with an interest rate between 0.25%-0.5% above the Bank of England base rate.

Under some circumstances though, they could reach much higher, but this is not specifically because the property you’re buying is a second home. Apart from the eligibility criteria, rates will be determined by what your intentions are for your second home. Buy-to-lets, holiday lets and commercial properties will need a specific type of mortgage.

The Bank of England’s base rate decisions have a direct affect on both tracker and standard variable rate mortgages, which can fluctuate in accordance. Fixed-rates avoid this uncertainty but there’s the risk you could lock-in too high if the base rate starts to come back down during the term of your deal.

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Are the rates always higher for second homes?

Generally no, you will find that you’ll likely be charged the same rate interest if you have a second home mortgage compared to a primary one. While the exact rate offered will be at the discretion of the lender, and based on the criteria that’s typically used for a standard mortgage too (the loan-to-value ratio, your credit rating, age, income and affordability, and the type of property you’re looking at), the only thing that’s likely to be higher is the deposit requirement.

Why is this the case?

It comes down to that overriding benchmark that is ‘risk’. Lenders will always take steps to protect themselves from any potential loss in investing their money in your mortgage, and taking on another substantial loan, and the huge long-term commitment and extra cost that comes with it, could be risky. Asking for a bigger deposit on your repayments ensures they make gains on that loan from the outset, minimising their losses should the worst happen down the line.

Of course, there are ways to convince a lender that you’re a credible and reliable borrower by having a large amount of equity in your first home, putting down a robust deposit and putting together a strong application, which will always make you a more attractive borrower. An experienced broker, like the ones we work with, can help you with this.

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How to compare second home mortgage deals

When it comes to buying a second home that needs mortgaging, it’s wise to make sure your first port of call is to find a reliable mortgage broker. Ultimately, the crucial second home mortgage rates you’ll secure will almost certainly be more favourable if you work with an advisor who knows where the best deals are and has access to them, which are the most amenable lenders, and what they’re likely to stretch to for a borrower like you.

There are many factors at play that will determine what kind of rates you’ll get, but research will need to be meticulous, precise and detailed to find the best ones. There are comparison sites out there that might give you a ballpark figure, however it’s very unlikely you will find the exact rate you’ll end up with there, making it impossible to calculate definite repayments for budgeting.

Which lenders are offering the best deals at the moment?

Take a look at our rates table below to get a rough idea of the current deals available for second home mortgages.

Lender Product Details
Frosted Rates Image

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Last updated May 2024

Please note that the above rates were accurate at the time of writing, but are always subject to change at the lender’s discretion. Speaking to a mortgage broker is the best way to find the most up-to-date deals.

Get matched with a second home mortgage specialist

The specialist brokers we work with understand the complexities that come with getting a mortgage on a second home, and that good interest rates on one can be hard to determine, and even tricker to secure.

We work to match you up with the advisor to suit your unique circumstances, aware that individual mortgages and applications have a direct effect on interest rates, and ultimately your long-term financial commitment. Contact us today on 0808 189 2301 for a free consultation to get the ball rolling, or make an online enquiry.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

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