What is a Buy To Let (BTL) Mortgage
A buy to let mortgage is aimed at individuals intending to become a landlord. The buyer is responsible for the mortgage repayments, however, they can’t live in the property. They apply to residential properties that the buyer intends to rent out for a profit.
With a buy to let mortgage, the lender will assess the profitability of the property in question. Some other key differences from a residential mortgage are:
- Higher fees
- Higher minimum deposit requirement (usually over 25%)
- Most are interest-only mortgages, although it is possible to find a repayment BTL mortgage
- The interest rates are generally higher than in a standard mortgage
- The lending is not usually regulated by the Financial Conduct Authority (FCA) unless you let the property to a close member of the family
Who can get a BTL Mortgage?
To take out a mortgage for buy to let properties, you must already be a homeowner. You will need to have good credit, earn over £25k and be under a certain age. This age varies depending on the mortgage term, but generally the mortgage will need to pay off before you are 70.