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

Most lenders require 20-25% deposit. First-time landlords often find better rates with 25% or more. Portfolio landlords (4+ properties) may need 25-40%.

How is buy-to-let affordability calculated?

Lenders assess affordability based on expected rental income, not your salary. Rent typically needs to be 125-145% of the mortgage payment at a stress-test rate.

Should I buy through a limited company?

Limited companies are more tax-efficient for higher-rate taxpayers (corporation tax vs income tax). However, company mortgages have slightly higher rates. Personal ownership is simpler for 1-2 properties.

What rates can I expect?

BTL rates are typically 0.5-1.5% higher than residential mortgages. Limited company rates are higher still. Larger deposits and smaller portfolios get better rates.

Can I let to family members?

Yes, with a regulated buy-to-let mortgage. Not all lenders offer these, and they may have stricter requirements. We can find lenders who allow family letting.

What if I have 4+ properties already?

You're classified as a portfolio landlord. Lenders require more documentation and stress-test your whole portfolio. Some lenders don't work with portfolio landlords at all.

FCA Regulated

Buy to LetMortgages UK

Buy-to-let lending has changed. The old "borrow as much as possible" approach doesn't work with today's stress tests and tax rules.

Rental coverage, personal vs limited company, portfolio rules — there's more to getting approved than just having a deposit. The right structure matters as much as the right rate.

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TL;DR — What Do I Need for a Buy-to-Let Mortgage?

Typically need 20-25% deposit (portfolio landlords may need 25-40%)
Rent must cover 125-145% of mortgage payment at stress test rate
Limited company ownership is more tax-efficient for higher-rate taxpayers
BTL rates are 0.5-1.5% higher than residential mortgages
4+ mortgaged properties classifies you as portfolio landlord with stricter rules

Is This Page For You?

This page is for landlords (current or aspiring) who want to understand the real requirements — not marketing. If any of these apply, we can help:

First-time landlord looking to buy a rental property

Expanding your portfolio with additional properties

Remortgaging existing buy-to-let properties

Considering switching from personal to limited company ownership

HMO or multi-let property purchase

Portfolio landlord (4+ mortgaged properties)

Letting to family members (regulated BTL)

Converting residential property to buy-to-let

Why Buy-to-Let Applications Fail

Most BTL declines come from rental coverage issues or portfolio complexity — not deposit size. Here's what typically goes wrong:

Rental coverage doesn't pass the stress test

Lenders stress-test at 5.5-6% interest, not your actual rate. A property that seems viable can fail affordability tests if rent isn't high enough relative to the stressed payment.

Portfolio landlord rules triggered

Once you have 4+ mortgaged properties, you're a portfolio landlord. Some lenders won't work with you at all. Others require detailed portfolio breakdowns and stress-test everything.

Wrong ownership structure

Higher-rate taxpayers often benefit from limited company ownership for tax efficiency. But if you already own personally, transferring triggers Stamp Duty. Structure decisions need planning upfront.

Property type issues

HMOs, multi-unit blocks, and above-commercial flats need specialist lenders. Standard BTL lenders often decline these even if the numbers work.

Minimum income not met

Most BTL lenders require minimum personal income of £25,000-£30,000 (even though rental income is the main factor). Some first-time landlords are surprised by this.

How We Approach It Differently

We work backwards from your situation — property type, portfolio size, tax position — to find lenders whose criteria actually fit.

Rental coverage calculation

We check which lenders your property passes with. Different stress-test rates mean the same property can pass with one lender and fail with another.

Portfolio-friendly lenders

We know which lenders work with portfolio landlords and what documentation they need. No wasted applications to lenders who'll decline on portfolio grounds.

Structure advice

Personal vs limited company, SPV setup, portfolio consolidation — we help you understand the pros and cons for your specific situation.

Specialist property types

HMOs, multi-units, above-commercial — we work with lenders who specialise in these. Standard BTL lenders often can't help.

Common Buy-to-Let Mistakes

Buying before checking rental coverage

A property can look great on paper but fail lender stress tests. Check rental viability before committing to purchase.

Not planning for portfolio landlord rules

Your 4th mortgaged property triggers portfolio rules. Plan for this in advance — some lenders work better with portfolios than others.

Wrong ownership structure for tax efficiency

Higher-rate taxpayers often pay more tax than necessary by owning personally. But changing later is expensive. Get structure right from the start.

Only comparing headline rates

BTL products have arrangement fees, valuation fees, and different early repayment charges. Total cost over the deal period matters more than rate alone.

"Buy-to-let isn't just about finding the lowest rate. Structure, rental coverage, and portfolio planning matter more long-term than saving 0.1% on rate."

Jay Sabine

Principal Adviser, Your Home Finance

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Jay Sabine

CeMAP, Cert CII (MP)

29 Years Experience

Content reviewed: January 2026

CeMAP awarded by The London Institute of Banking & Finance. Cert CII (MP) awarded by the Chartered Insurance Institute.