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Buy-to-let Mortgages Advice

Aspiring landlords will not be allowed to use a standard mortgage to buy their investment property. They are required to use a buy-to-let mortgage. Uncover the details of a BTL mortgage here and speak with a Moneysprite buy-to-let mortgage broker for tailored support.

What is a buy-to-let mortgage?

A buy-to-let mortgage, also known as a BTL mortgage, is a mortgage for those wanting to buy property to rent out as an investment. If you plan on becoming a landlord and renting the property out, you must have a buy-to-let mortgage instead of a residential mortgage.

Many buy-to-let mortgages are interest-only mortgages where only the interest is paid, and the principal amount is repaid at the end of the mortgage (usually saved up through rent payments). However, there are other types of BTL mortgages available.

Who can get a buy-to-let mortgage?

Anyone can get a buy-to-let mortgage – subject to lender approval - if they are going to rent out the property they are purchasing. Lending to someone who plans to rent out the property is considered riskier by lenders. This is because they have no control over the tenants and their ability to keep up with their rent. As a result, you usually need a larger deposit to access a BTL mortgage.

How much can you borrow?

As there is increased risk with a BTL property, lenders typically require a bigger deposit than if you were taking out a residential mortgage. Whereas you can get mortgages with as little as a 15% deposit for residential mortgages, you may need between 25-40% deposit for a rental investment property.

Therefore, you will not usually be able to borrow around 75% of the property value or less. How much you can actually borrow will be determined by individual circumstances, such as your income and existing debts.

How to get a BTL Mortgage

BTL mortgages are available from a host of mortgage lenders. Finding the most advantageous deal based on your personal circumstances can be challenging. Your application will be subject to stringent affordability assessment, including a credit score check.

Why use an adviser to find a buy-to-let mortgage

It can be beneficial to use a mortgage adviser when you need a standard residential mortgage. This is just as true, if not more so, when looking for a more complicated buy-to-let mortgage. An adviser will be able to work with you to assess suitability for different mortgage types based on your property investment plans. They will make the process smoother and could save you time and money.

Reach out to one of our Moneysprite buy-to-let mortgage brokers to discuss your buy to let options. We have advisers from Poole to Cornwall and back across to Southampton, Birmingham, and Norwich, and help clients throughout the UK. Our friendly and patient team are here to assist you.

Request a callback from one of our advisers

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