Buy to Let Guide - Home Me Mortgages
What is a Buy-to-Let Mortgage?
A buy-to-let (BTL) mortgage is for properties you intend to rent out, not live in.
- You earn rental income from tenants.
- You can buy in your personal name or through a limited company.
BTL mortgages are assessed differently than residential ones - with a focus on rental income rather than your salary.
Great for building long-term wealth through property.
Who Can Get a Buy-to-Let Mortgage?
Typically, lenders require you to:
- Own a residential property already (some make exceptions)
- Have a minimum income (usually £20,000-£30,000)
- Be aged 21-85 (upper limit varies)
- Pass affordability checks - mostly based on rental income
Even first-time landlords can apply - with the right guidance.
How Does Affordability Work?
BTL affordability is usually based on rental coverage, not just your income.
- Most lenders require the rent to cover 125%-145% of the mortgage payment at a stress-tested rate (e.g. 5.5%).
Example:
- Mortgage interest = £750/month → Rent must be at least £938-£1,087/month depending on lender rules.
Higher-rate taxpayers and limited company borrowers are stress tested differently.
We’ll run the numbers for you and help maximise your borrowing potential.
Should I Buy Personally or via a Limited Company?
Personal ownership:
- Simpler process
- Potential for lower rates
- Income taxed as personal income (up to 45%)
Limited company (Ltd):
- Mortgage held in a Special Purpose Vehicle (SPV)
- Profits taxed at 19-25% corporation tax
- More tax-efficient for higher earners
- Can retain profits within the company for reinvestment
Speak to an accountant and broker before deciding - structure matters!
Deposit Requirements
- Minimum deposit is usually 25% of the purchase price.
- Larger deposits (30-40%) open up better mortgage deals.
For example:
- Property price: £200,000 → You’ll need at least £50,000 deposit.
Some lenders accept gifted deposits - we can guide you on options.
What Are the Costs?
- Stamp Duty: Additional 3% surcharge applies to BTL properties.
- Mortgage arrangement fees: Often higher than residential (£999-£2,000+)
- Valuation and legal fees: Vary by lender and property type
- Letting agent fees (if used): Typically 8-15% of rental income
- Maintenance, insurance, void periods - build a buffer fund
We’ll help you map out a full cost breakdown upfront.
Portfolio Landlords
If you own 4 or more mortgaged properties, you’re classed as a portfolio landlord.
- Lenders will look at your full portfolio’s performance.
- They may require business plans, cash flow analysis, and rental accounts.
We specialise in portfolio applications and structuring for growth.
Can I Remortgage or Release Equity?
Yes - many landlords remortgage to:
- Get a better rate
- Release equity for further purchases
- Consolidate multiple mortgages
You can remortgage personally or through your Ltd company - criteria differ slightly.
BTL for Limited Companies – What You Need
- An SPV (Special Purpose Vehicle) set up under specific SIC codes (e.g. 68100, 68209)
- A business bank account
- Directors/guarantors must often provide personal guarantees
- Some lenders require experience or minimum income, others don’t
We’ll help you set up correctly and access limited-company-specific lenders.
Why Use a Broker for BTL?
- Access to personal & Ltd company lenders
- Help with complex income, multiple properties, or new landlords
- Guidance on ownership structure and tax implications (in partnership with your accountant)
- Speed, clarity, and confidence
We’re experts in property finance - so you don’t have to be.
Why Home Me Mortgages?
- Specialists in buy-to-let and property investors
- Access to over 100 lenders - including portfolio and Ltd company specialists
- End-to-end support - from sourcing deals to submitting the application
- Based in Maidenhead, serving investors across the UK
Whether it’s your first BTL or your 15th, we’ve got you covered.