What documents do I need for a buy-to-let mortgage application?

If you are applying for a buy-to-let mortgage, it pays to know what documents to have ready. Sorting through paperwork can be stressful, especially when you are working under the pressure of time.

This being the case, we have put together the following handy buy-to-let guide to mortgage application documents. Knowing ahead of time what to have ready for each stage of the application will make the process as fast and stress-free as possible.

What do we need to get you a decision in principle?

The very first stage of a buy-to-let application, getting a decision in principle, does not involve any paperwork. All we need is to have a conversation with you. The discussion will take approximately 40 minutes to an hour, during which time we will ask you questions to understand what your objectives are and what we need to find from a product to meet your requirements.

During this conversation we will ask you what your income is. We need to know this before we can proceed to the next step.

The information you provide will enable us to search for a buy-to-let mortgage product that matches your criteria. Once we have done this, we will approach the lender offering the product to secure a decision in principle. A decision in principle means that given the facts presented, the lender would be prepared to lend you the funds you need.

Key facts illustration

This document is the first piece of documentation you are likely to encounter in the course of a buy-to-let application. The key facts illustration (KFI) will outline in detail the product which we are recommending and why we are recommending it. We will send this to you via email wherever possible.

The buy-to-let mortgage application

If, after assessing the suitability of the product we recommend, you are happy to proceed, we will take instruction from you and anyone else being named on the mortgage to make an application to the lender. We can receive this instruction via the telephone or via email. (If you prefer you can instruct us via post, but in our experience clients prefer to use either of the other methods.)

Before we can proceed with the application, we will ask you to provide evidence of your income. Buy-to-let lenders reserve the right to request evidence of income from a borrower at any point throughout the application process. We may or may not ever have to see the evidence you provide.

What constitutes evidence of income?

  • Employed individuals: 3 month’s payslips and/or a P60
  • Self-employed sole traders: SA302
  • Limited companies: 2 years audited accounts

If you cannot provide evidence of your income, we will not be able to help you find a buy-to-let mortgage on this occasion.

Submitting a buy-to-let application

When we submit your application, we will tell you what documents your lender will need to process it. This is where the bulk of the application paperwork comes into play.

Documents you will commonly be asked for

Identification

This will generally be your passport or driving licence. Some lenders may accept something like a gun licence but this is far less common.

Proof of address

Any utility bill, letter from your council, bank statement, car tax (mobile telephone contracts are not accepted). Any proof of address must be recent i.e. they must be dated within 3 months of the current date.

Proof of deposit

Savings

An original bank statement (i.e. not a copy). If you have internet banking and can only print off your statement at home you may be required to take this into your bank and get it certified.

Gifted deposit

If you are being given a monetary gift you will need a letter from the person gifting you the money and a bank statement from that person showing they have the funds.

Sale of property

When the deposit is coming from the sale of a property you will need a sale memorandum from the estate agent or your solicitor and an original bank statement to show you have the money.

Inheritance

If your deposit is as the result of inheriting money you will need a letter from your solicitor stipulating the amount of the funds and a bank statement to show the funds in your account.

NOTE: Where you have different amounts coming into your bank account from multiple sources the lender will want to see a full audit trail for the funds – so if you have received money via a number of the avenues mentioned above you will be required to provide all the details for each sum that appears on the statement.

Bank statements

Lenders generally ask for 3 months bank statements (these must be originals not photo or scanned copies), a small number ask for just 1 or 2 months statements and some require pay-slips in addition to the statements. Some lenders may be looking to see rental income, your salary being paid in if you are employed or may require your accounts as well as your bank statements if you are self-employed.

Again, if you have internet banking and can only print off your statement at home you may be required to take this into your bank and get it certified.


If you are EMPLOYED:

Below are the other documents you may be asked for when applying for a buy-to-let mortgage:

Payslips

You can expect to have to provide between 1 and 3 months-worth of payslips.

P60

This is a statement issued to taxpayers at the end of the tax year by their employer; it confirms your final tax code and earnings for the year as well as tax deductions and National Insurance contributions.


If you are SELF-EMPLOYED:

The documents that self-employed individuals have to provide differ from those of an employed person simply because your circumstances are different, for example you do not receive a P60 statement so alternative documentation is required:

SA302

An SA302 is issued by HM Revenue and Customs and it outlines your income and tax deductions.

If you have submitted your Self-Assessment tax return online, you will be able to download your SA302 online too.

SA302’s are only issued in paper form if you submitted a paper tax return for HMRC to calculate your tax for you, if you made changes to a paper tax return or if HMRC disagrees with the amount of tax you have stated that you owe.

Visit the HMRC website for details and help on SA302’s.

Accounts

Lenders will commonly ask you to provide 1 to 3 years of accounts for your business if you are self-employed, sometimes a lender will approach your accountant for a reference.

Assets and Liabilities Statement

Each lender will want you to answer different questions on an Assets and Liabilities Statement, which will usually be available to you as a downloadable template from their website.


If you are a LIMITED COMPANY:

As a limited company there are again differences in the documents you may be asked to supply when you apply for a buy-to-let mortgage:

Accounts

For a limited company your annual accounts or ‘statutory accounts’ include a balance sheet (which must include the printed name and signature of one of the company directors), a profit and loss account, notes about the accounts and both a director’s and auditor’s report.

For more information about producing accounts visit the following pages of the UK government’s website.

Assets and Liabilities Statement

Lenders usually make a template Assets and Liabilities Statement available as a download from their website which you can complete. The information required varies from lender to lender.


Other documents
lenders may ask for:

Buy-to-Let Schedule

A Buy-to-let schedule should outline the details of all the properties within your portfolio, to include address, current value, capital outstanding on the mortgage, lender and the monthly repayment amount or rate. This one is only asked for by a few lenders.

Residential mortgage statement

Some lenders ask you to provide the latest details for any borrowing you have against your home. Lenders usually send this to you annually and in most cases the most recent one you have received will be sufficient.

Buy-to-let mortgage statement(s)

You may have to provide the latest statements from any buy-to-let properties you own, as with the residential statements your most recent version is generally sufficient.

Credit/Store/Loan Statements

A small number of lenders will ask for statements of any outstanding debt you have.

Mortgage declaration

A mortgage declaration is a statement which you sign to stipulate that all of the information provided with your application is accurate.

Direct debit mandate

You may be asked to provide a direct debit mandate or DDM to your lender with your application showing them where repayments will be taken from if the mortgage goes ahead.

Existing AST and/or ARLA statement

AST stands for Assured Shorthold Tenancy agreement, lenders may ask you for the AST for the property you are proposing to buy and/or (although less commonly) the AST’s for your existing portfolio. ARLA stands for Association of Residential Lettings Agents, these statements are less commonly asked for in our experience.

Signed application form

Some lenders are not yet wholly digital in their process and will need you to provide a signed application form in paper format.

Fees

A small number of lenders require any lender fees chargeable to be paid, before a case is sent to their underwriting team.


The list above is not exhaustive, but we have outlined here the documents we see requested most commonly. We will let you know what you need to provide to an individual lender on a case-by-case basis. In most cases, clients only need to provide a selection of the documents listed above.

Ready to proceed with your next buy-to-let mortgage application? Enquire today

This information should not be interpreted as financial advice. Buy to let mortgage rates are subject to change. Speak to our advisors for a mortgage illustration.

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