Buy To Let Mortgages

How to navigate the world of buy to let mortgages.

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By Lisa NichollsCeMAP

Last Reviewed: 27th July 2023

Navigating the world of buy to let mortgages can be daunting, particularly now that there are new rules and regulations to contend with. We’re here to guide the way.

How can I get a buy to let mortgage?

If this is your first investment, there are a few things to consider.

After all, owning a buy to let property is very different from owning your own home.

As soon as you become a landlord, you take on a number of legal responsibilities.

Not to mention the new rules, regulations and taxes that have been imposed on buy to let investors in the last few years.

Don’t worry, you’re in good hands.

We’re clued-up on all aspects of buy to let legislation, and we can certainly help to find the most suitable buy to let mortgage for you.

With more changes likely in the future, it’s important to get the right advice now. That’s where we come in.

Recommended reading: Are you thinking about buy to let remortgages or are you looking for a buy to let mortgage with bad credit?

In what circumstances do I need a buy to let mortgage?

Here’s when should you look into applying for a buy to let mortgage.

  • You want to invest in a house or flats to rent out.
  • You can afford to take a financial risk which may or may not pay off.
  • You have a good credit rating and are not struggling to pay off any debts that you do have.

What else do I need to consider before taking out a buy to let mortgage?

There are a few questions to ask yourself before investing in your first buy to let property.

  • Are you willing to tie up your money for a prolonged period of time?
  • Do you understand that there is a chance that the price of the property you buy may rise or fall considerably?
  • Do you understand the costs, time and responsibilities involved with being a landlord?
  • Are you aware of the fees involved if you use a letting agent to manage your property?
  • Have you set money aside for the additional costs of buying, including survey fees, solicitor’s fees and stamp duty land tax?

If you’re happy with all of the above, great. It’s time to start looking for a buy to let mortgage.

What is the difference between a buy to let mortgage and an ordinary mortgage?

Most buy to let mortgages are not regulated.

  • Mortgage fees for a buy to let property can be much higher.
  • Interest rates on buy to let mortgages are usually higher too.

Many clients arrange a buy to let mortgages on interest only.

You won’t pay any capital back each month, but you will need to ensure that the capital is paid in full at the end of the mortgage term, usually from the sale of the property. You must cover any shortfall.

What deposit is needed for a buy to let mortgage?

You’ll need a bigger deposit for a buy to let mortgage.

The minimum deposit amount required for most buy to let mortgages is 25% of the property’s value.

What if I already have an ordinary mortgage, and I want to switch to buy to let?

This is possible, but it will depend on your circumstances.

For example, if you plan to rent out your main residence and move into a rented property, some lenders might not be happy to offer you a buy to let mortgage.

However, if you plan on renting out your main residence and buying a new property to live in, lenders are usually more likely to approve your application for a buy to let mortgage. There are two ways this can work.

  • Let to buy mortgage – this means that you can buy a new home with an ordinary mortgage, and switch your mortgage on your previous property to a buy to let rate. In some cases, you can even raise money to fund the deposit for your new property if you have enough equity. Do your research though, because some lenders are wary of first time landlords with no rental experience.
  • Consent to let mortgage – if you’re currently on a good mortgage rate, it’s always worth asking your lender’s permission to let the property under your current mortgage contract, instead of switching to a buy to let mortgage. They might say yes, they might say no. You’ll never know unless you try.

If you want to switch your current mortgage to a buy to let mortgage, get in touch. We can give you expert advice, and search for the most suitable buy to let mortgage for you.

Need more information? Read our related quick help guides: 

I’m already a landlord, can I get a new buy to let mortgage?

Of course, we can help you get a better rate on your buy to let mortgage.

Whether you want to move away from your current lender, or you just want to see which rates are out there, we can advise you on your next steps.

Check out our mortgage rate history guide and our mortgage interest forecasting for the next 5 years here.

Ready to invest in a buy to let property?

If you’re thinking about becoming a landlord and building a portfolio, or you simply want to get a better deal on your current buy to let mortgage, we’d love to help, we can also offer advice on buy to let for bad credit. With access to over 80 lenders, we can find the right buy to let mortgage for you.

Call us today on 01925 906 210 or contact us. One of our advisors can talk through all of your options with you.


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