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Buy-to-let mortgages: Everything you need to know

Posted on: 26/11/2021

Buy-to-let (BTL) properties are a popular investment. And with the rise of the 'staycation' and Airbnb trend, the popularity of BTLs doesn't look to be slowing.

If your looking to buy-to-let, then this article is for you. Members of our Conveyancing, Tax and Dispute teams have outlined everything you need to know about buy-to-let mortgages.

What is a buy-to-let mortgage?

Buy-to-let (BTL) mortgages are specific mortgages for borrowers in order that they may purchase a property to rent out to another person rather than live in it themselves. Thereby becoming a landlord of a property.

How do buy-to-let mortgages work?

Most BTL mortgages are interest only, meaning that borrowers only pay the interest on the loan and none of the capital. The interest is paid monthly.

The full amount of the mortgage (the capital debt) will still be payable at the end of the agreed mortgage period.

For most borrowers, the monthly interest payment amount shouldn’t in itself be too much of an expense and is usually covered by the rent received on the property.

However, borrowers will need to make sure that they are able to pay off the capital debt at the end of the term; or refinance the loan.

Who can get a buy-to-let mortgage?

This often depends on the mortgage lender. Some lenders will not lend to a person if they do not already own a home or have a bad credit history, but some will.

There are some criteria though, that most lenders will take into account…

What deposit do I need for a buy-to-let mortgage?

One of which is the deposit. Generally, buy-to-let mortgages require a higher deposit than residential mortgages. According to, the average loan to value (LTV) ratio for a BTL mortgage is 75%; meaning that borrowers will require a 25% deposit.

This does of course vary between mortgage providers.

Click here to read the full article.

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