How buy-to-let mortgages work: criteria and eligibility

A buy-to-let mortgage is a loan secured on a residential property that will be let to tenants rather than lived in by the owner. It can be used to buy a rental or to refinance one. Lenders base the loan mainly on the expected rent, and the terms do not allow the owner or close family to live there.

Buy-to-let mortgages are offered by banks, building societies and specialist lenders. They come as fixed, tracker and discounted products, on interest-only or repayment terms, and can be taken in a personal name or through a limited company, though limited company lending has its own criteria. An overview of the market is on the buy-to-let mortgages page.

The lender lends a share of the property value, up to its maximum loan-to-value, and the landlord pays the rest as a deposit. Monthly payments are usually interest-only, so the loan is repaid at the end of the term from a sale or refinance. The rent is expected to cover the payments and running costs.

When the initial deal ends, the loan moves to the lender's variable rate unless the landlord switches to a new product or remortgages. Lenders expect the property to be let on an assured shorthold tenancy in England, or the equivalent elsewhere in the UK, and some restrict short lets or lettings to students and sharers.

Lenders set criteria on the borrower, the property and the rent. Typical borrower requirements include a minimum age, an acceptable credit history and, with many lenders, a minimum personal income or existing home ownership. The property must be suitable to let, in good condition and of a type the lender accepts, such as a standard house or flat.

The rent test is the main affordability check. The PRA expects lenders to test the rent against interest at a stress rate of at least 5.5% for most products, with each lender setting its own interest cover ratio (PRA Supervisory Statement SS13/16, accessed 20 Oct 2026). Many lenders also take the landlord's tax rate and other mortgaged properties into account.

Landlords with four or more mortgaged rental properties are usually treated as portfolio landlords. Lenders then look at the whole portfolio, not just the new purchase, and ask for details of every property, its rent and its mortgage.

Buy-to-let mortgages usually need a larger deposit than residential mortgages, because lenders set lower maximum loan-to-value limits on rental property. The deposit needed for a particular purchase depends on the lender's limit, the property type and whether the rent passes the lender's test at the loan amount wanted.

How much deposit lenders ask for, and how the rent test can increase it, is covered in detail on the page about buy-to-let deposits and loan-to-value. Stamp duty at the higher rates for additional property, legal and valuation fees and a reserve for repairs and voids are needed on top of the deposit (GOV.UK, Stamp Duty Land Tax: higher rates for additional properties, accessed 20 Oct 2026).

Most buy-to-let mortgages are unregulated, because they are business lending to landlords. Two exceptions are regulated. A loan where the property is lived in by the borrower or close family is a regulated mortgage contract, and consumer buy-to-let covers accidental landlords, such as people who inherited a property or could not sell (FCA Handbook PERG 4.4, accessed 20 Oct 2026).

Regulated and consumer buy-to-let borrowers have more protection, including affordability rules and complaint rights. For standard buy-to-let lending, lenders still follow PRA underwriting standards on rent and affordability, but the FCA mortgage conduct rules do not apply in the same way.

Getting a buy-to-let mortgage follows a set order: work out the deposit and budget, check the expected rent, get a decision in principle, find the property, apply with full documents, and complete once the valuation and legal work are done. The valuer usually confirms the rent as well as the value.

Lenders typically ask for proof of identity and address, income, the deposit source, details of any existing property and a rental estimate. Specialist buy-to-let mortgage brokers can compare lenders' criteria for a particular case, especially for first-time landlords or less common property types.

Before applying, it helps to check the expected rent with local letting agents and to allow for running costs, so the figures given to the lender are realistic. A rent estimate well above the valuer's view can reduce the loan offered late in the process.