Becoming a landlord can feel daunting when you're starting from scratch, but understanding the mortgage process makes everything clearer. Buy-to-let mortgages work differently from residential ones, and knowing what lenders expect will help you prepare properly.
What makes buy-to-let mortgages different?
To start with, you'll need a larger deposit than you would for a home you plan to live in. Most lenders want at least 25% of the property's value, though some ask for 40%. The application process focuses heavily on rental income potential rather than just your personal earnings.
Lenders usually require the expected rent to cover 125% to 145% of your monthly mortgage payment. This means if your mortgage costs £800 per month, you'll need to demonstrate rental income of at least £1,000 to £1,160.
Income requirements you should know about
Most lenders want evidence of a minimum personal income, usually between £25,000 and £30,000 annually. This remains true even though rental income covers the mortgage payments. Be ready to prove your income through payslips, tax returns, or accounts if you're self-employed.
Lenders scrutinise your financial behaviour more carefully for investment properties than residential ones, so take care with your credit history. Late payments, defaults, or County Court Judgements can seriously damage your chances of approval.
Choosing the right property
Location influences everything from rental demand to mortgage availability. Properties in areas with strong rental markets and good transport links attract more interest from both tenants and lenders. Consider university towns, commuter zones, or areas undergoing regeneration.
The property type matters too. Lenders often restrict mortgages on certain types of property, including flats above commercial premises, ex-local authority properties, or houses in multiple occupation (HMOs), which often require specialist mortgage products rather than standard buy-to-let deals. Standard two or three-bedroom houses in good condition usually sail through the application process.
Additional costs and considerations
Recent tax changes mean landlords pay more tax on rental income than they used to, particularly if you're in a higher tax bracket.
You'll also need landlord insurance, safety certificates for gas and electrical systems, and potentially an Energy Performance Certificate. These costs add up quickly, so factor them into your calculations before committing to a property purchase.
Taking your first steps
Do your homework before viewing properties. You need to know what rent you can realistically charge, how much profit you'll make, and how quickly you can find tenants when someone moves out. These figures determine whether a property is actually a good investment.
The experienced team at MoneySprite can help you navigate the buy-to-let mortgage market and find products suited to first-time landlords across the UK. Speak with our mortgage advisers today to discuss how property investment could work for your financial future.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
MOST BUY TO LET MORTGAGES ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.
HM REVENUE AND CUSTOMS PRACTICE AND THE LAW RELATING TO TAXATION ARE COMPLEX AND SUBJECT TO INDIVIDUAL CIRCUMSTANCES AND CHANGES WHICH CANNOT BE FORESEEN.
Approved by The Openwork Partnership on 26/01/2026.
