Your guide to buy to let mortgages and lender criteria
You can find the top 5 buy to let mortgage products by initial rate below. Click through to see the full range of deals available. This will show you the APR, initial rate, fixed term and the reverting rate for the mortgage.
Buy to let mortgage rates updated twice a day
We are a specialist buy to let mortgage broker, talk to us for:
- Full breakdown of Early Repayment Charges, APR and fixed rate periods
- Unbiased mortgage recommendation: we have no ties to any lenders
- Get a great deal thanks to our comprehensive lender search
- Access to mortgage deals up to 85% loan to value
- No minimum personal income required (rental, pension, investment and part-time income considered)
- Less hassle for you: our team will process your case to completion
- Decision in principle from a lender commonly within two hours
Understanding buy to let mortgages
If invest in residential property to let to paying tenants, you cannot use an ordinary mortgage. A specialist buy to let mortgage is required.
Demand for buy to let finance has soared since it first took off in 1996. By the end of 2014, around 15% of all outstanding mortgages in the UK were buy to let loans. Competition has led to a booming market, with diverse products available to suit all kinds of property investors.
As a specialist buy to let mortgage broker, our goal is to find you a great deal on a product tailored to your requirements. Your advisor will undertake a comprehensive search of products from a wide range of lenders.
Buy to let mortgages are based on the rent, rather than personal income
Buy-to-let mortgages are specialist products that allow you to borrow based on the rental income-generating potential of your property.
Therefore, even if you have a low personal income, we may be able to help you. As long as your rental income sufficiently covers your mortgage interest payments, there are lenders who will consider funding your venture.
Lenders use rental income to calculate how much you can borrow. Lower rent limits how much you can borrow against a rental property. But different lenders use different rental calculations. We understand where your application will have the best chance of acceptance.
The minimum buy to let deposit is 15% of the property value
Buy to let investors must put down larger cash deposits than owner-occupiers. The most any lender will agree to lend is 85%, leaving the borrower to cover the remaining 15%. (This is an 85% loan to value, or LTV, mortgage.)
Not all lenders allow borrowing up to 85% LTV. Most lend no more than 70–75% of the property value. And if you want to qualify for products with the lowest interest rates, you will need to borrow no more than 60%.
60% LTV mortgages are more suitable for risk-averse investors who prefer a larger equity buffer. Between the lower interest rate and smaller loan size, they also allow investors to keep their repayment costs down. And if your eventual goal is to have an unencumbered property, 40% of equity gives you a good start.
Our buy to let guide for 2018 and beyond helps you navigate and understand the changes that affect the buy to let market. Find out about new tax rules and changes to important legislation that impacts how you run your rental property portfolio from day to day.