Buy to Let Mortgage
When buying a property to rent out a landlord might consider a buy to let mortgage (or BTL mortgage). There are some differences between a normal mortgage and a buy to let mortgage, but they are similar in most respects.
There might be some unusual circumstances surrounding your client's situation, however. In these cases, a complex buy to let mortgage might be better for your client.
Access to buy-to-let lenders can be restricted for brokers. That’s because most providers will only lend through approved distributors such as Enterprise.
Not only do we give you access to a panel of the best complex buy-to-let lenders, but Enterprise also simplifies the process for you, by seeing your client’s application through from its first enquiry all the way through to its completion.
Buy-to-let loan FAQs
Who might want to use a Buy to Let Mortgage?
- Someone who has a good credit record
- Someone who can afford to take the risk
- Someone who owns their own home will find it easier to get a buy to let mortgage
- Someone looking to invest in property, specifically houses or flats
- Someone who has a relatively high salary
- Someone who is under 70, in general, although older applicants can be assessed
Some of the differences between a buy to let mortgage and a normal mortgage are:
- Interest rates on buy-to-let mortgages are usually higher
- Buy to let mortgages have higher fees
- The minimum deposit for a buy-to-let mortgage is usually 25% of the property’s value (although it can vary between 20-40%)
- The majority of buy-to let mortgages are interest only mortgages
- The FCA (Financial Conduct Authority) does not usually regulate buy-to-let mortgages
BTL Mortgages: How much can be borrowed?
- The amount that can be borrowed is based on the rental income achievable
- Generally the assessment of the affordability of the mortgage payment is based on the rental income the property generates versus the mortgage payment with an added 45% to cover shortfalls
- The service charges associated with the rental will also be taken into account when assessing affordability