A pied-a-terre mortgage is a specialised loan for purchasing a second home used occasionally, often by professionals needing a city base. This case study explains how pied-a-terre mortgages work for professionals who need a second home in a city, outlining the challenges, lender criteria, and solutions for securing the best terms.

The scope of this article covers pied-a-terre mortgages for professionals such as barristers, executives, and high-net-worth individuals who require a secondary residence for work or convenience. In particular for a Barrister client we helped secure a second home in Bristol.

The topic matters because these clients face unique financial and lifestyle challenges, including managing dual properties, navigating strict lender requirements, and balancing career demands with family life.

What is a Pied-à-Terre Mortgage? Who Qualifies? What Are the Key Requirements?

Definition: A pied-à-terre mortgage is a specialized loan used to purchase a second home that is not the primary residence. It is a type of residential mortgage, but with stricter requirements than a standard home mortgage. Lenders consider these higher risk, resulting in stricter qualifying criteria, higher down payments (typically at least 20% to 25%), and higher interest rates. You must clarify to the lender that the property is for personal, intermittent use and not a full-time rental to avoid stricter requirements. The primary distinction of a pied-à-terre is that it is a secondary residence, which poses greater risk to lenders and does not benefit from favourable tax treatment. A mortgage broker can help navigate these stricter requirements and secure better deals for pied-à-terre and second home mortgages.

Key Facts:

  • A pied-à-terre mortgage is for a second home, not your main residence.
  • It is considered a type of second mortgage, distinct from a buy to let mortgage (which is for properties intended to be rented out) and a holiday home mortgage (which is for properties used primarily for vacation or leisure).
  • Lenders view these as higher risk, so expect:
  • Stricter qualifying criteria
  • Larger down payments (usually 10%–25%)
  • Higher interest rates may apply
  • The property must be for your personal, occasional use, not a rental or investment.
  • Renting out a pied-à-terre usually requires a different mortgage product with stricter terms.

Background: What is a Pied-à-Terre and How Does Its Mortgage Differ?

Pied-à-terre translates to “foot on the ground” and signifies a small apartment or studio in a bustling city used as a part-time residence. A pied-à-terre mortgage is a specialised loan used to purchase a second home that is not the primary residence. Pied-à-terre is not a distinct financial product but a term for financing a second home used occasionally while maintaining a primary residence elsewhere.

How is a pied-à-terre mortgage different from other second home or investment property mortgages?

  • Pied-à-terre: Intended for personal, intermittent use, not for generating rental income.
  • Second home mortgage: Designed for properties you will use personally and not rent out. Some second home mortgages are used to purchase properties for your own use or for dependent relatives, and lenders may have specific policies, deposit requirements, and interest-only options for these cases.
  • Buy to let mortgage: Specifically for landlords who intend to rent the property to tenants on a permanent basis. Rental income is a key consideration for eligibility, and these mortgages are structured to reflect the income generated from rent.
  • Holiday home mortgage: Tailored for properties used for leisure or vacation. If you plan to use the property occasionally and rent it out for short intervals (such as a few days or weeks), a holiday home mortgage may be more suitable and may allow short-term rent to offset costs.
  • Investment property mortgage: Used for properties intended to be rented out full-time, with stricter lending criteria and higher rates.

If you plan to rent out a property permanently, a buy to let mortgage is more appropriate. If you intend to use the property occasionally and rent it out for short periods, a holiday home mortgage may be a better fit. A second home is for personal use and not for rent, but if the property is for dependent relatives, lenders may have different criteria and requirements.

Location: Yorkshire & Bristol

Loan Amount: £400000

Finance Category: Residential Mortgage

The Story

Client Background

In the competitive world of property finance, securing a pied-a-terre mortgage can be a game-changer for professionals balancing career demands with lifestyle transitions. At Fox Davidson, we specialise in tailoring pied-a-terre mortgages to meet the unique needs of clients such as high-net-worth individuals, including barristers, doctors, and executives who require a secondary residence for work or convenience.

Relocation Challenges

Our client, a successful barrister based in Bristol, exemplified this scenario perfectly. Working from chambers in the heart of the city, he had built a thriving practice that required frequent presence for court appearances, client meetings, and networking events. However, personal circumstances prompted a major life change: relocating his family to the picturesque countryside of Yorkshire for a better quality of life, including access to top schools and a more relaxed environment away from urban hustle.

The move was exciting, but it came with a significant hurdle: he needed to maintain a base in Bristol to continue his professional commitments without disruption. Selling his current Bristol home immediately would have left him without a local residence during the transition, potentially jeopardising his caseload and income. As a buyer, he had to consider the cost of moving, the debt associated with holding two mortgages, and the need to pay for ongoing expenses such as council tax and maintenance on two properties.

Financial Considerations

Enter the need for a pied-a-terre mortgage. The client approached Fox Davidson after researching specialists in second home mortgages and mortgages for barristers, particularly those experienced in pied-a-terre financing.

He required a £400,000 loan to purchase a compact, modern apartment in central Bristol that would serve as his professional pied-a-terre. This property would allow him to stay overnight during intense work periods, host colleagues, or prepare for trials without the fatigue of long commutes from Yorkshire.

Importantly, he sought a mortgage on an interest only basis, where repayments would be covered by the eventual sale of either the new property or his existing main residence, which was already on the market. This structure appealed to him as it minimised monthly outgoings during the relocation phase, preserving cash flow for moving costs and settling into Yorkshire life.

When applying for a second home mortgage, you must prove you can afford the repayments on both your existing mortgage and the new loan. Most lenders will assess your ability to afford both your existing mortgage and the new loan, and your existing mortgage repayments are typically considered a key commitment. The lender will conduct a stringent credit check and stress tests to gauge whether you can handle potential interest rate fluctuations, especially when managing two mortgages.

Purchasing a second home is considered an additional purchase for stamp duty purposes, which means it is usually taxed at a higher rate and includes a 3% surcharge. However, if you sell your first property within two years of buying the second home, you may be eligible for a rebate on the additional stamp duty surcharge.

At Fox Davidson, we pride ourselves on our comprehensive across market access as a broker, enabling us to navigate the nuances of pied-a-terre mortgages that many high-street lenders overlook. Using a mortgage broker is especially valuable for complex cases like pied-a-terre mortgages, as we can access specialist lenders and secure better terms that may not be available through standard bank processes. Pied-a-terre financing isn’t just about how much you can borrow; it’s about strategic planning for dual residences, understanding the minimum deposit required (typically at least 10% for a second home), tax implications like council tax on second homes, and ensuring affordability under strict lending criteria. It is also possible to remortgage your existing property to raise the deposit for your additional purchase. Our initial consultation revealed the client’s strong financial position: a substantial income from his barrister practice, equity in his current home exceeding the required thresholds, and no outstanding debts.

We discussed how pied-a-terre mortgages differ from standard buy-to-let or holiday let options, emphasising their focus on personal use rather than rental income. Interest rates for pied-a-terre mortgages can be higher than for main residences, and the deal we negotiated ensured competitive terms for the client. A pied-à-terre, often located in a prime urban area, can appreciate in value over time, making it a valuable long-term investment. This case highlighted the growing demand for pied-a-terre mortgages and second home mortgages among professionals in the UK, especially post-pandemic, as remote work blurs the lines between primary and secondary homes.

By optimising our approach for pied-a-terre mortgages, we aimed to provide not just funding, but a tailored solution that supported our client’s career continuity and family aspirations, while carefully managing the cost, debt, and financial risks associated with owning two properties.

These unique circumstances led to a series of challenges in securing the right mortgage, as detailed in the next section.

The Challenge

Lender Criteria

Securing a pied-a-terre mortgage often involves navigating strict lender criteria, particularly when the second property serves a specific professional purpose while the main family home remains in a different part of the country.

In this case, the barrister’s primary residence was already established in the countryside of Yorkshire, where his family had relocated for lifestyle reasons, including better schools and a quieter environment.

The pied-a-terre apartment he needed to buy was in central Bristol, close to his chambers, to enable him to stay overnight during court days, client meetings, and trial preparations without the exhaustion of lengthy daily commutes from Yorkshire.

While the geographical separation between Yorkshire (main home) and Bristol (pied-a-terre) generally satisfied most lenders’ preference for the second property to be in a different location or city from the primary residence, challenges remained.

Some lenders still apply caution to pied-a-terre applications, questioning whether the additional property is truly necessary or if it risks stretching affordability too far. They often require clear evidence that the pied-a-terre is for genuine occasional personal use (not rental or investment) and that the borrower’s work genuinely demands a local base, supported by proof such as chambers contracts, court schedules, or travel patterns.

Affordability Assessment

Lenders use strict affordability criteria when assessing affordability for a pied-a-terre mortgage. This includes stress-testing the client’s ability to service both properties simultaneously: the existing Yorkshire mortgage (plus council tax, utilities, and maintenance there), alongside the new Bristol pied-a-terre mortgage, its separate council tax (often with a second-home premium), and running costs. Lenders may provide up to five times the applicant’s salary for a second home mortgage, and some mortgage lenders may lend up to six times the applicant’s salary, depending on their lending criteria.

Deposit Requirements

Deposit requirements are typically more demanding for second homes due to the increased risk. Lenders typically want a larger deposit for second homes, and the minimum deposit is generally 10%. However, some specialist lenders may offer second home mortgages with a 5% deposit, while others require a 25% deposit. Most deposits for second home mortgages are around 25%, as lenders typically prefer a 25% deposit to minimise risk. The larger the deposit, the lower the interest rate on a second home mortgage, and interest rates can vary significantly based on the size of the deposit. A larger deposit not only reduces the lender’s risk but also helps borrowers access lower interest rates and better terms.

For an interest-only basis pied-a-terre mortgage, where repayments were minimal and the capital repayment strategy relied on the eventual sale of the Bristol property, criteria tightened further. Many providers limit interest only loan-to-value to around 50%-60% although sale of second home can go to 90% with an element of capital repayment above the interest only limit.

Additional Costs

The overall cost of owning a second home includes not only the deposit and mortgage repayments but also:

  • Stamp duty
  • Council tax (often with a second-home premium)
  • Ongoing maintenance
  • Utilities
  • Insurance

Even with the locations in different regions, some lenders viewed the setup conservatively: maintaining two homes long-term (rather than a short transition) raised concerns about ongoing dual costs, potential lifestyle impact, or changes in circumstances (e.g. if work patterns shifted post-pandemic).

High-street banks frequently imposed blanket rules or higher rates for second homes/pied-a-terre, while specialist lenders and building societies required exhaustive documentation, employment verification tying the barrister to Bristol, detailed explanations of why commuting wasn’t viable, and financial projections showing sustained affordability without relying on future income increases. The risk for both lenders and borrowers is typically higher with second homes, so lenders offer stricter lending criteria and require more robust evidence of affordability.

Despite these hurdles, our approach led to a successful outcome, as described below.

The Solution

Securing the Mortgage

Through Fox Davidson’s specialist expertise in pied-à-terre mortgages, we successfully navigated the complexities of this dual-location scenario to deliver an outstanding result for the barrister. With the main family home firmly established in the Yorkshire countryside and the new pied-à-terre apartment required in central Bristol for professional purposes, the geographical separation between the two properties aligned well with most lenders’ preferences for second-home financing, unlike same-city applications that often face blanket restrictions.

Leveraging our comprehensive, across market access and deep relationships with specialist lenders experienced in pied-à-terre mortgages for high-earning professionals, we approached providers known for flexibility in accommodating work-driven second homes.

Final Terms

We built a compelling, evidence-based case: detailed proof of the barrister’s ongoing commitments in Bristol chambers, clear demonstration that daily commuting from Yorkshire was impractical and unsustainable, and robust financials showing sustained affordability for both properties.

The affordability stress-testing was thorough but passed convincingly. Lenders confirmed the client’s strong income from his barrister practice could comfortably cover the Yorkshire main residence mortgage alongside the new Bristol interest-only facility, plus separate council tax (including any second-home premiums), utilities, insurance, and maintenance costs.

For the interest-only structure, with repayment secured via the eventual sale of the Bristol pied-à-terre, we targeted lenders comfortable with this approach, typically at loan-to-value ratios of 50% to 75%, backed by ample equity and high income verification.

Summary of Key Mortgage Terms:

  • Loan Amount: £400,000 (interest-only)
  • Fixed Rate: sub 3% for the initial two years (well below prevailing market rates for second-home products at the time)
  • Deposit: approx. 25% (in line with most lender requirements)
  • Monthly Payments: Minimal, preserving cash flow during dual-residence use

Client Results

Competition among the shortlisted lenders worked in our favour. After initial enquiries and detailed underwriting discussions, we secured conditional offers from three specialist second home mortgage providers, each willing to support the genuine pied-à-terre use case.

This enabled us to present the client with a choice of attractive options, including both fixed and variable rates.

Completion proceeded smoothly. The client purchased his compact, well-located Bristol apartment, establishing an efficient professional base for overnight stays and work demands. This setup enabled seamless continuity in his Bristol practice while enjoying family life in Yorkshire long-term. He later shared that the arrangement significantly improved his work-life balance.

This successful outcome highlights Fox Davidson’s strength in optimising pied-à-terre mortgages for professionals with genuine cross-regional needs. By focusing on plausibility, affordability, and the right lender panel, we secured competitive terms that many brokers would struggle to achieve.

If you’re a high-net-worth individual or professional considering a pied-à-terre mortgage to balance career commitments with family relocation, whether maintaining a city base while living rurally, or vice versa, our team can provide the tailored guidance and market access to make it happen efficiently and cost-effectively.