Buy-To-Let Mortgages

What are Buy-To-Let Mortgages?

Buy-To-Let (BTL) Mortgages are for landlords who want to buy property that they intend to rent out, they are buying the property for investment purposes. Buy-To-Let Mortgages work differently to standard residential mortgages.

The minimum deposit for a BTL Mortgage is higher, (usually at least 25% of the property value) with affordability being calculated against the rental income. Most BTL Mortgages are interest-only, meaning the borrower pays the interest each month but not the capital amount. At the end of the mortgage term, the borrower will repay the capital debt.

Pricing can vary across the BTL market and at NapeX Finance we split up what we call “Mainstream Buy-To-Let” and “Specialist Buy-To-Let” due to the different ranges of lenders and pricing within the sector.

To help source our clients the best rates available for Buy-To-Let Mortgages, we use a balance of our experience, in-house finance models, and specialist sourcing systems to save our clients time when purchasing or refinancing property.

Mainstream Buy-To-Let

Mainstream Buy-To-Let’s are residential properties in residential locations (cities and towns). For example flats, houses and small Houses of Multiple Occupation (HMO; up to 6 rooms).

Specialist Buy-To-Let

Specialist Buy-To-Let’s are classified as ‘non-standard’ houses and flats. Or may be required for clients who are deemed complex by the lenders (e.g. offshore). At Napex we pride ourselves on dealing with the large, complicated, and more unusual properties.

Loan Information:

Typical Terms: 75% Interest Only

Affordability: Based off the gross rental income.
(Most lenders use the rental income to qualify the loan apart from some high street banks that will want to see a client’s personal income can afford the Buy-To-Let and all other commitments).

Payment Structure: Interest Only, Capital and Interest available.

Security: Typically require a 1st legal charge and personal guarantees for limited companies.

Fees: Lenders will often add fees above the loan and can sometimes provide free solicitors and surveys.

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Useful Information

Take a look at our Useful Information section for some extra guidance and insights about what you are requesting.

Property Types:

  • Large Houses of multiple occupation (HMO), 7+ rooms (also known as c4 planning or sui generis).
  • Small HMO’s where customers want an investment valuation (sub six bedrooms).
  • Residential blocks. Including blocks with no concentration limits. Or blocks with flats below 30 square metres.
  • Student-lets and purpose-built student accommodation.
  • High value single units.
  • Residential Buy-To-Lets, that are above commercial property, in commercial locations or in agricultural areas.
  • Holiday lets and Airbnb.
  • Grade 1 and Grade 2 listed.
  • Ex-local authority blocks.
  • Properties with planning issues or short leases.
  • Property that lenders deem un-mortgageable.
  • Property that will house non-standard tenants (e.g housing association, council charity, church etc. or just let on commercial lease).

Borrower Types:

  • Expats and overseas clients
  • Offshore company structures
  • More than four applicants to the loan
  • Unusual ownership (charity etc)
  • Clients with adverse credit
  • Let to a family member
  • Limited experience
  • Gifted equity

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