Buy to let mortgage
advice experts

Buy To Let mortgages are for Landlords that want to buy property to rent out to a tenant and generate an additional income.

Buy To Let mortgages do have a lot of similarities to a standard mortgage (you’ll find that most lenders will have some form of Buy to Let mortgage product), though there are a few things around the criteria that are different.

For example, Buy To Let mortgages affordability may be assessed on how much Rental Income can be generated, rather than the amount of money you earn. The product fees and interest rates tend to be a little higher than a standard mortgage and it’s usually easier to have these mortgages on an interest Only repayment basis.

Typically, Buy To Let mortgages are a bit more expensive than the type of mortgage used to buy your own home. That’s because traditionally, lenders see getting rent from tenants to be more of a risk than a homeowner making their own monthly mortgage payments. You also need to be aware that lenders will take into account extras such as maintenance costs, agent’s fees and landlord’s insurance when working out how much you can borrow.

A Buy To Let mortgage can be for someone who wants to become a professional landlord or already owns properties and wishes to add to their portfolio. Others who may need to apply for a Buy to Let mortgage are ‘accidental landlord’s’ – those who own their home but would like to rent it out. If it’s for less than a year, you can apply for a Consent to Let. For longer than this period, you may want to think about switching to a Buy To Let mortgage.

Becoming a landlord might be planned, or by default you inherit a property. Either way, the asset you have can help towards your overall property investment strategy.

The amount you can borrow with a Buy to Let mortgage is calculated in a different way to most other mortgages:

• Your mortgage amount is typically based on how much income you will earn renting out the property.
• This is what’s called your Income Coverage Ratio – it’s there to make sure your rental income is enough to cover the total cost of your mortgage and associated fees.
• Lenders also use something called stress rate. This factors in your income and existing debt to calculate whether you could afford a higher rate of interest.

Yes! Most lenders will allow you to remortgage your main home and raise the deposit needed in order to Buy to Let. You’ll need to double check you have sufficient Equity within your home, the affordability stacks up, and that the money raised is enough to put down as a deposit.

This is one of the most common ways that we find people invest in property for the very first time.

*You may have to pay an early repayment charge to your existing lender if you remortgage early.

There is no strict limit, but some mortgage lenders may impose restrictions on the number of mortgages or the total amount borrowed that they allow you to have.