Mortgage guides

The maximum amount you can borrow depends on the size of your deposit and the amount of rental income you expect to make. Lenders typically require the rental income to be 25-30% higher than your mortgage amount, so that there's less risk of you being unable to cover your payments.

Use our buy to let mortgage calculator to calculate an estimate of how much you could borrow based on your expected rental income.

BTL mortgages interest rates are similar to residential products but do typically come with higher fees. Lenders require larger deposits compared to residential as they are typically higher risk.

You may also face additional costs as a landlord, such as letting agent fees and higher taxes.

Our specialist brokers can help you consider all the costs involved in taking out a buy to let mortgage so you can make the most informed decisions for your investment.

As well as interest rates, it's important to compare the different fees charged on buy to let mortgage deals, as they can increase your overall costs. These include but aren't limited to:

• Arrangement fees - charged for setting up the mortgage, either as a fixed amount or a percentage of the loan
• Valuation fees - a fee for the lender to assess the property's value to determine how much they're willing to lend
• Legal fees - solicitors or conveyancers charge these for handling the legal aspects of the property purchase

Our expert brokers are well-versed in calculating the overall cost of taking out a BTL mortgage, helping you find the best deal for your budget.

Before getting a buy to let mortgage, it's crucial you understand the tax implications of getting a buy to let mortgage, as they can significantly impact the overall costs of your investment. We have a Tax Adviser partner we work with who can provide impartial tax advice tailored to your needs.

Stamp Duty Land Tax (SDLT)

SDLT is a tax you pay when you buy a property. It increases depending on the value of your property. The same applies when you use a buy to let mortgage to purchase an investment property, but with an additional 5% increase.

You and your spouse are considered a single 'unit', so you can't avoid paying the additional 5% by having your spouse buy the second property in their name.

Stamp Duty Land Tax Examples

Income tax

The income you earn from your rental property is taxable. The amount of income tax you must pay depends on the amount of rental income you earn, the tax bracket you fall into and any allowable expenses you can deduct.

You should get professional tax advice before taking out a BTL mortgage. Ideally, you should consult a property tax specialist with experience advising landlords and we can introduce you to a trusted firm to provide this.

Yes, you need a BTL mortgage for renting. You'll breach the terms of your residential mortgage if you rent it out unless you get the lender's consent. You can only rent a property without a buy to let mortgage or the lender's consent if you own the property outright.

Yes, first-time buyers can get a BTL mortgage.

If you're a first-time buyer, our expert brokers can help you understand your options and meet lender criteria should you decide to go ahead.

Yes, you can switch your mortgage to buy to let. It's crucial you do this before renting out a property on which you have a residential mortgage. You would breach your mortgage agreement if you didn't, which could put you at risk of having your property repossessed.

Alternatively, you could ask your lender for their consent to let, which they might agree to for a set period of 6-12 months. This can be a good short-term solution, especially if you might want to use the property for residential purposes again in the future.

Speak to one of our expert buy to let mortgage brokers who can talk you through the process of remortgaging to a buy to let. If you are looking to do an onward purchase you may wish to discuss let to buy options.

Purchasing or refinancing your existing property into a limited company buy to let mortgage might be more suitable for you depending on your income tax bracket and long-term plans. We can explore both personal name and ltd company ownership and suggest you speak to a professional tax adviser before making this decision.

There are many other considerations regarding whether it would be more beneficial for you to get a buy to let mortgage as a limited company or a personal landlord. Our experts can help you understand your options given your unique circumstances. It's worth consulting with tax professionals as well.