Paragon steps back into holiday lets and short-term finance

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  • 01/06/2021
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Paragon steps back into holiday lets and short-term finance
Paragon Bank has re-entered the holiday let and short-term finance markets.

The bank is offering four products for purchasing or remortgaging single self-contained properties that are being let on an approved holiday occupancy agreement, including Air BnB.

Investors can take out a mortgage in their own name or through their limited company.

The two-year fixed rate products are available at 70 per cent loan to value (LTV) on a maximum loan of £500,000. Rates start at 4.20 per cent, two of the four mortgages feature no product fee and all include a free valuation.

A £299 application fee is payable and early repayment charges are three per cent for two years.

Paragon has also re-launched its short-term finance range suitable for refurbishment projects classified as standard, light and heavy.

The standard and light refurbishment products are offered up to 70 per cent LTV and the heavy refurbishment option is available up to 65 per cent LTV all on maximum purchase or remortgage loans of £1,000,000.

Monthly product rates range between 0.45 per cent and 0.65 per cent for the standard, 0.55 per cent and 1.20 per cent for the light refurbishment and 0.65 per cent and 1.15 per cent for loans financing heavy refurbishment projects.

Valuation fees start at £280, application fees are £150 and early repayments are charged at one per cent for one month on the standard refurbishment product and one per cent for two months on the light and heavy refurbishment products.

Moray Hulme (pictured), director for mortgage sales, said: “With restrictions easing here in the UK but still so much uncertainty surrounding overseas travel, domestic holidays are already proving to be extremely popular again this year. To support those who want to invest in properties that cater to this market, we have refreshed our offering by adding four holiday let products.

“We have also extended our range to include flexible short-term finance for landlords who are undertaking refurbishment projects.

“The significant improvement in the quality of private rented sector houses seen over the past decade correlates with investment through buy-to-let finance and these products are an example of the part that lenders can play. Sitting alongside our recently launched energy efficient mortgage range, our short-term finance products show the support that Paragon is providing the many landlords who are working to improve the standard of privately rented housing in the UK.”

Last month, Paragon announced its plans to exit the second charge mortgage market where it had been active for more than two decades.

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