Buy to Let Mortgage

Buy-to-let (BTL) mortgages are for landlords who buy property specifically to rent out. Investing in property is risky, so you shouldn’t take out a BTL mortgage if you can’t afford to take that risk.

You’ll struggle to get a buy-to-let mortgage if you don’t already own your own home, whether outright or with an outstanding mortgage. You must have a good credit record and not be stretched too much on your other borrowings such as your existing mortgage and credit cards. And you are likely to find it harder to get a buy-to-let mortgage unless you earn at least £25,000 a year.

Lenders will have their own upper age limits - typically between 75 or 85. This is the oldest you can be when the mortgage ends not when it starts.

Key Features

The maximum you can borrow is linked to the amount of rental income you expect to receive. Lenders typically need the rental income to be a 25% to 45% more than your monthly mortgage payment.

The minimum deposit for a buy-to-let mortgage is usually a 25% of the property’s value (some lenders offer deals with a 15% deposit.Interest rates on buy-to-let mortgages tend to be higher and so are the fees

Most BTL mortgages are interest-only, which means you don’t pay anything off the lump sum borrowed each month but, of course, at the end of the mortgage term you must repay the capital in full.

Unlike obtaining a mortgage on a property you wish to live in, BTL mortgage lending is not regulated by the Financial Conduct Authority (FCA) unless you wish to let the property to a close family member.


Things to consider

Whether to set up a limited company

What are the running costs

Will you have to pay income tax on the rental income

Real Life Stories

We have helped many clients over the years build their buy to let portfolios. Click here to read some of their stories.