Buy to Let Mortgages

The term ‘’buy to let’ mortgage generally relates to a property that you own but do not live in. Because these are essentially loans to invest, there tend to be stricter lending criteria than for residential mortgages. Typically, you will be offered a loan of up to a maximum of 80% of the value of the property but this may be as low as 60% for your first buy to let property. As you are not living in the property, the lender will assess the affordability of the loan based on the rental cover.

They will usually expect the monthly rental payment to be at least 125% of the monthly mortgage payment. Unlike residential mortgages, buy to let mortgages are more likely to be interest only and the lender will not expect you to evidence that you can repay the loan at the end of the term since you are not living in the property. This is because they assume you will simply repay the loan through the sale of the property.

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