Specialist

Buy To Let Mortgages

For Refinancing & Buying Investment Property In The UK

Buy to Let Mortgages

Clifton private finance

We can source buy to let mortgage finance from £150,000 for property in the UK

 
We offer creative solutions for landlords who wish to purchase or remortgage buy to let properties.
Our buy to let mortgage service provides:
  • Buy to let finance from £50,000
  • Market leading rates
  • 2nd charge options for raising finance
  • Expertise in dealing with buy to let portfolios, Limited companies using retained profits
  • Specialist portfolio finance products for landlords with more than 4 properties
  • Interest roll up product options
  • Landlord light & heavy refurbishment finance available on attractive terms
  • UK expat, non-dom and foreign national landlord mortgage finance available
  • We can help if you have multiple buy to let properties, Multi-unitHMOs, AirBnBs, student lets and complex structures
  • Fast professional service. We understand that sometimes finance needs to be arranged quickly!

Buy To Let

Up to £750k

5.4% APR

2 Year Tracker (Remortgage)

Subsequent rate 5.55%

LTV - 75%

APRC 8.9%*

Product fee 3% 

Free Valuation

Early redemption charges

As at 11th January 2024

Buy To Let

Up to £1m

4.51% APR

5 Year Fixed (Purchase)

Subsequent rate 9.59%

LTV - 65%

APRC 8.1%*

Product Fee £3,999

£300 Cashback

Early redemption charges

As at 11th January 2024

Buy & Refurb

1 to 12 Months

0.55% pm

1 to 12 months

Purchase & refurb

LTV - 60%

Buying & Renovating

Conversions

Auction Purchase

As at 11th January 2024

Contact Us

Thank You for your interest - please complete the form below and a member of our team will be in contact.


Through our market knowledge we can deliver bespoke terms based on your requirements.  
Call our buy-to-let team on  0117 959 5094 to discuss your requirements or book a call-back below.
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Comparing Buy to Let Mortgages

 

Buying a property to let can be a great investment, allowing you to generate income through rent. However, financing a buy-to-let property requires careful consideration, as the mortgage options differ from standard residential mortgages.

In this guide, we'll explain the key factors to compare when choosing a buy-to-let mortgage deal for your investment property purchase or remortgage.

In this Guide:

  1. How Do Buy-to-Let Mortgages Work?
  2. Compare Buy-to-Let Mortgage Rates
  3. Affordability Rules for Landlords
  4. Portfolio Landlords
  5. First-Time Buyers
  6. Limited Company Borrowing
  7. Alternative Finance Options
  8. Why Use a Mortgage Broker?
  9. FAQs 

How Do Buy-to-Let Mortgages Work?

Buy-to-let mortgages function similarly to standard residential mortgages in that they allow you to borrow money to purchase a property.

However, there are some key differences to go over:

  • The property is purchased solely as an investment, not as your home. You normally need to already own your own home.
  • The mortgage rates are typically higher than residential deals. Lenders view buy-to-let as a higher risk.
  • Stricter rental cover criteria apply. Your rental income must cover the mortgage payments by a minimum percentage set by the lender.
  • Affordability may be assessed both personally and on the property itself. The lender reviews your personal income and expenditure.
  • The application process examines your status as a landlord. Your experience and existing portfolio will be considered.
  • The maximum loan amount may be lower compared to residential lending. The lender will be more conservative.
  • You can't access products like Help to Buy. Buy-to-let is not subsidised by the government.
  • Buy-to-let mortgages allow first-time buyers to purchase a property to let while continuing to rent their home.

While more complex, buy-to-let mortgages allow experienced and first-time landlords alike to fund investment property purchases. Now, let’s look at how to go about comparing these types of mortgages in a little more detail. 

Compare Buy-to-Let Mortgage Rates

When you're comparing buy-to-let mortgage rates, there are a few things you need to keep in mind – most important of all is; the interest rate, the term of the loan, and the fees.

The best way to compare buy-to-let mortgage deals across the market is to use a comparison website. These websites allow you to compare deals from a range of lenders, all in one place. However, there are two main problems with this method:

  1. Not all lenders are on comparison sites.
  2. They only provide a surface level quote from each lender - if your circumstances are even slightly bespoke, then the rates will change, and the comparison could be pointless.

This is why using a buy to let mortgage broker, like Clifton Private Finance, provides a more comprehensive comparison of the market.

Interest Rates for Buy-to-Let Mortgages

The interest rate is one of the most important factors when comparing buy-to-let mortgage deals. Lenders offer both fixed and variable rate options:
  • Fixed rate mortgages allow you to lock in an interest rate for a set period, usually 2-5 years. This gives certainty over monthly repayments.
  • Tracker mortgages follow the Bank of England base rate plus a set margin above it. Your payments fluctuate but could be lower if rates drop.
  • Discounted variable rate mortgages offer a discount off the lender's standard variable rate for a set period. Payments vary and discounts eventually revert to the higher SVR.

We recommend shopping around for the most competitive interest rates. As independent mortgage brokers, we can access exclusive buy-to-let mortgage deals you may not find yourself direct from lenders.

Even small differences in interest rates can make a big difference over the term of the loan.

Buy-to-Let Mortgage Upfront Fees

In addition to interest rates, compare any fees charged on buy-to-let mortgages:

  • Arrangement fees are charged for setting up the mortgage, typically £1000-£2000. Some deals offer a fee-free option.
  • Exit fees apply if you repay your mortgage during a special offer period, such as £3,000 on a 5-year fixed rate. Consider potential exit fees when comparing deals.
  • Valuation fees cover the lender's property valuation report. Expect to pay £200-£400 for a standard valuation.
  • Legal fees will also apply for conveyancing work, around £500-£1000.

Some lenders charge application fees too. We recommend factoring all these costs into choosing a competitive deal overall.

Loan-to-Value (LTV)

The loan-to-value is the percentage of the property's value you wish to borrow. Buy-to-let mortgages generally offer up to 75% LTV, sometimes 85% LTV. The higher the LTV, the higher the interest rate.

If your deposit is at least 25% of the property's value, you'll access better mortgage rates. With a smaller deposit of 15-20%, expect to pay higher rates or fees. Additionally, remortgaging could allow you to access better LTV rates if your property value has increased. 

Buy-to-Let Affordability Rules for Landlords

Since 2017, strict affordability rules apply to buy-to-let mortgages regulated by the Financial Conduct Authority (FCA). Lenders must assess affordability not just on current rates, but also on higher stress test rates set by the regulator.

This means meeting minimum rental cover requirements alone may not be enough. Lenders will review your personal income and expenditure to ensure you can still cover your mortgage costs if rates rise significantly.

At Clifton Private Finance, our brokers will guide you through providing the necessary income evidence and documentation to satisfy affordability assessments.

Rental Cover Requirements Lenders require buy-to-let mortgages to meet rental cover tests. This means your expected monthly rental income must cover your mortgage payments by a minimum percentage, typically 125-150%.

The higher your loan-to-value (LTV) and interest rate, the higher the rental cover percentage required. By law, lenders must also assess affordability based on projected interest rates. 

Mortgages for Portfolio Landlords

If you already own multiple investment properties, remortgaging your portfolio on better terms could save you thousands. Many lenders have specific criteria for portfolio landlords:

  • Some lenders limit lending to portfolio landlords or those with 4 or more mortgaged buy-to-let properties.
  • Evidence of strong overall rental cover across your portfolio is required. Our brokers can assess your entire portfolio income and make sure it meets lender criteria.
  • Rates may be higher for larger portfolios. As independent brokers, we can access portfolio landlord products from banks and specialist lenders.

With established landlord clients, we understand the complexities of buy-to-let portfolio borrowing. Our expert advice takes the stress out of remortgaging your rental properties. 

Book Consultation »

Buy-to-Let Mortgages for First-Time Buyers

First-time buyers sometimes purchase property as an investment rather than their main residence. This allows them to get on the property ladder while continuing to rent.

Buy-to-let mortgages are accessible for first-time buyers, but expect higher rates and stricter criteria:

  • Most lenders require a minimum 25% deposit from a first-time buyer. Some even need 30-40% upfront.
  • Evidence of strong savings and ability to cover costs on a single income are often required. Parents may need to act as guarantors.
  • Many lenders have limited buy-to-let products for first-time buyers. As whole-of-market brokers, we can find deals to suit your situation.

If you’re a first-time investor, our mortgage experts will guide you through providing evidence of a strong financial position to meet lender affordability rules. 

Limited Company Borrowing for Buy-to-Let Mortgages

Many landlords choose to purchase investment property through a limited company, which can offer tax advantages. The mortgage application process differs for limited companies:

  • Most lenders will only lend to established companies with multiple years' of accounts. Start-ups may struggle to secure lending.
  • Rental cover tests are based on company accounts and cash flow projections.
  • Director's personal income isn't usually considered but personal guarantees may be required.
  • Mortgage rates can be higher than personal buy-to-let mortgages.

We specialise in limited company buy-to-let mortgages, advising landlords on the best options. With expertise in company accounts analysis, we'll guide you through the process to successfully finance your rental property purchase. 

Alternative Finance Options

If you've been turned down for standard buy-to-let lending, alternative options can help finance your investment property:

  • Commercial mortgages may offer higher LTVs and lower rental cover requirements, although interest rates are usually higher.
  • Bridging loans provide short-term finance that can be repaid once long-term lending is secured, enabling you to complete time-sensitive purchases.
  • Second-charge mortgages use your existing property asset as security for further lending.

Drawing on our whole-of-market knowledge, we'll explore alternative routes if needed to help you achieve your investment ambitions. Our priority is finding a tailored solution that best fits your financial situation and rental property needs. 

Refurbishment Finance for Landlords

If you need to renovate or improve your rental property, specialist refurbishment mortgages allow you to finance the works as part of your overall borrowing.

Light refurbishment mortgages cover smaller updates like new kitchens, bathrooms, windows etc. Heavy refurb products finance major works such as conversions and extensions. Here’s how it works:

  • Loans to purchase and refurbish in one long-term mortgage
  • Access to funds in stages as works complete
  • No need to arrange separate loans
  • Rates comparable to standard buy-to-let deals 

Why Use a Mortgage Broker for Your Buy-to-Let Mortgage?

With so many options available, the process of securing investment finance can be complex. With that said, here’s how we can help:

  • Access to exclusive mortgage deals you often can't get yourself directly from lenders
  • Expertise in navigating lender criteria for limited company, portfolio landlord and complex buy-to-let cases
  • Guidance on optimising your application to meet affordability and rental cover requirements
  • Whole-of-market view to find the right lender to suit your individual needs
  • Support with paperwork and application process to make financing seamless

As experienced specialists in buy-to-let lending, we've helped hundreds of landlords successfully purchase and remortgage investment properties.

We're familiar with the quirks of different lender criteria and can identify the most suitable products for your situation. If you're considering financing for a rental property purchase or remortgage, contact us today at Clifton Private Finance to review your options. Whether you're starting as a first-time landlord or expanding an existing portfolio, we can help your investment journey go smoothly.

For personalised buy-to-let mortgage advice from expert brokers, book your free consultation at Clifton Private Finance today on 0117 959 5094. 

FAQs

What types of property can I get a buy-to-let mortgage for?

Most lenders will offer buy-to-let mortgages for standard residential properties, along with multi-unit blocks, HMOs, holiday lets, and student properties. Commercial properties may require a commercial mortgage.

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

Most lenders require a minimum 25% deposit. With at least 25% deposit, better interest rates are available. With a smaller 15-20% deposit, expect to pay higher rates or fees.

Can I get a buy-to-let mortgage on a new build property?

Yes, new build properties can be purchased as buy-to-lets. Expect to pay a higher deposit of around 25-30% for new builds. Specialist lenders also offer products suitable for new build investments.

What yield do lenders look for on a buy-to-let property?

There is no set yield, but typically lenders look for rental income to cover 125-150% of the mortgage payments. We'll assess the expected rental yield and make sure it meets lender requirements.

Can I remortgage my existing buy-to-let property?

Yes, you can remortgage a buy-to-let at any time to get a better interest rate or release equity. As experienced brokers, we can identify the most competitive remortgage deal.

How long does a buy-to-let mortgage application take?

If your situation is straightforward, it can take 4-6 weeks from application to mortgage offer. Complex cases may take longer. We'll guide you through providing all the necessary documents for a smooth application.

Can expats and foreign nationals get buy-to-let mortgages in the UK?

Yes, but the choice is more limited, and you may need a higher deposit (40% or more) and income evidence in English/Sterling. Lenders may also impose country-specific restrictions and rates may be higher than standard deals.

Can I get a buy-to-let mortgage with bad credit?

It is possible, but expect to provide a larger deposit and pay higher interest rates. Many lenders will be hesitant to lend to landlords with poor credit histories. 

Specialist buy to let mortgage service providing:

  • Expert advice on buy to let mortgage finance from £100,000
  • Advice on complex buy to let portfolios
  • Access to banks that provide UK expat and non UK citizen buy to let mortgage solutions
  • Short and long term lending options
  • Professional service
Our specialist mortgage broker service provides creative finance solutions for buy to let property. 
Call us on 0117 959 5094 to discuss your requirements.

Book Consultation »

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