Buy-To-Let Mortgages

Buy-to-Let Mortgages: Helping You Invest Smartly

While buy-to-let and residential mortgages share similarities, there are some key differences. A buy-to-let mortgage is required when you’re purchasing a property to rent out and generate income. Whether you’re building a property portfolio or letting out a single property, it’s important to understand your mortgage options, the associated costs, and your expected rental income.

Welcome to Art of Mortgage, Mortgage Brokers for Buy-to-Let

We have years of experience supporting clients in the buy-to-let sector. Whether you’re buying your first rental property, adding to an existing portfolio, remortgaging to release funds, or looking for insurance solutions for your investment properties — we can help.

What is a Buy-to-Let Mortgage?

A buy-to-let mortgage is specifically designed for rental properties. Unlike residential mortgages, the loan amount is largely based on the rental income the property is expected to generate. Lenders use this figure, along with your tax rate, to determine borrowing limits.

Most buy-to-let mortgages aren’t regulated by the Financial Conduct Authority (FCA), unless the property has been lived in by you or a family member — in which case, the mortgage is regulated.

These mortgages are often interest-only, meaning you only pay the interest each month and not the capital. While this keeps monthly payments lower, interest rates for buy-to-let deals are usually higher than those for residential mortgages.

Are Buy-to-Let Mortgages Harder to Get?

They can be. You’ll usually need a deposit of at least 20%, though lenders often ask for more due to the added risk. A larger deposit increases equity, offering more protection if house prices drop.

Lenders may also have requirements related to the type of tenant, property usage (e.g., Houses in Multiple Occupation), and the Energy Performance Certificate (EPC) rating.

Switching from Residential to Buy-to-Let

If you own a property with a residential mortgage and want to start renting it out, you may be able to remortgage onto a buy-to-let product. This depends on your eligibility and the terms of your existing mortgage.

Types of Buy-to-Let Mortgages

There are various buy-to-let mortgage options, depending on your deposit size and tax bracket. Fixed-rate and variable-rate deals are available, and repayments can be made on an interest-only or capital repayment basis — depending on your long-term goals.