Buy to Let Mortgages / Consumer BTL Mortgages

Long term investment
Acquiring your first property to let, or growing your rental portfolio, this type of investment can be very rewarding in the longer term, but as with most long-term investments it is not without risk.

Help with the next step
Prior to you taking the next steps, we will explain each of our Buy to Let mortgage products to ensure you have all the critical information you need to get moving.

Mortgage offers to fit your needs
While we normally provide BTL mortgage products that are self-financing (meaning that the earnings you generate from the property rent must cover the mortgage repayments), if the rental income generated from the property does not cover the monthly mortgage repayment, we may be able to use your surplus personal income to cover the mortgage repayments.

Don't forget the costs and fees
It is wise to ensure that the proposed rental income also covers the cost of insuring and maintaining the property.

Whilst we can provide you with product information from our range of BTL mortgages we cannot offer any advice to help you decide if a Buy to Let is suitable for you as a longer-term investment.

• You are a UK resident aged between 18 and 74
•  You have evidence of a minimum deposit of 25% 
• The property is valued at least £75,000
• You have minimum personal income of £30k per annum
• The Buy to Let property must meet EPC Regulations effective 1 April 2018. I.e., a minimum band rating of A-E.

Discover more about selecting a buy to let property, becoming a landlord, obligations and costs involved in renting out a property.

1 Understand more about buy to let mortgages

The rental calculation for a Buy to Let mortgage is based on the actual or expected rental. Rent must cover 125% of the ‘stressed mortgage payments’ for basic rate taxpayers, or 145% for higher rate taxpayers. The stressed mortgage payment is based on the product rate +2% or 5.5% whichever is higher. Personal income can be considered when assessing affordability if rental income is not enough. This is known as the Interest Coverage Ratio (ICR).

2 Research the property market

Doing your homework is vital when purchasing a BTL property. The fees, letting income and tenancy demand may differ across the country, therefore being familiar with the market enables you to make a much more informed decision.

3 Identify your locality and begin viewing properties

Now it's time to begin searching for the property that meets your needs and your prospective tenants' requirements. Dependent on where you buy, you may want to consider engaging a rental agency if you are seeking to purchase further away from where you live or you might want to manage the property personally if it's nearby.

4 Understanding your rental income

You should evaluate the complete costs of letting out a property, such as: mortgage fees, utility bills, maintenance, insurances, any agency fees, not forgetting to cover costs for occasions when the property might be vacant.

5 Select your BTL mortgage

Applying for a buy to let mortgage is different to residential mortgages. The amount you can lend is primarily dependent on letting income that you are predicting to secure from letting out the property.