A buy to let mortgage is a specialist mortgage for properties purchased to let to tenants. Affordability is assessed through the interest coverage ratio rather than personal income. The property type, ownership structure, and rental income all determine which lenders may consider an application. Woodhall Mortgages is a whole-of-market BTL mortgage broker with access to specialist BTL lenders across a comprehensive range of products. We compare buy to let mortgage rates, assess ICR across all property types, and advise on the most appropriate lender for your investment.
No fee for the initial discussion. A £299 broker fee is payable on a formal mortgage offer if you choose to proceed.
Discuss Your BTL MortgageA buy to let mortgage is a specialist mortgage for investment properties let to tenants. Affordability is based on the rental income using the interest coverage ratio (ICR): rent must cover the mortgage payment by at least 125% (personal ownership) or 145% (limited company). The minimum deposit is typically 25%. Most BTL mortgages are interest-only and are not regulated by the FCA.
A buy to let mortgage is a specialist mortgage for properties purchased to let to tenants rather than to live in. Unlike a residential mortgage, where affordability is assessed on the borrower's personal income, a buy to let mortgage is assessed primarily on the rental income the property is expected to generate. This is calculated through the interest coverage ratio (ICR): the monthly rent must exceed the monthly mortgage payment by a specified margin at the lender's stress test rate.
Most buy to let mortgages are offered on an interest-only basis. This means the monthly payment covers only the interest on the loan, not the capital. The outstanding balance remains constant throughout the mortgage term and is typically repaid through the sale of the property or refinancing at the end of the term. Repayment buy to let mortgages are available from some lenders but are less common.
Most buy to let mortgages are not regulated by the Financial Conduct Authority. The exception is a regulated buy to let, which applies when the borrower or a close family member intends to occupy the property. Regulated BTL is subject to the same consumer protection framework as residential mortgages.
The minimum deposit for a buy to let mortgage depends on the property type and ownership structure. The standard minimum for a single-let residential property in personal ownership is 25% of the purchase price (75% LTV). Specialist property types and certain ownership structures require larger deposits.
| Property / Structure Type | Typical Minimum Deposit | Typical Max LTV |
|---|---|---|
| Single-let residential (personal) | 25% | 75% |
| Single-let residential (limited company) | 25% | 75% |
| HMO (Houses in Multiple Occupation) | 30-40% | 60-70% |
| Multi-unit freehold block (MUFB) | 30-35% | 65-70% |
| Holiday let | 30-35% | 65-70% |
| Airbnb / short-term let | 30-35% | 65-70% |
| First-time landlord | 25-30% | 70-75% |
| Student let | 30-40% | 60-70% |
Deposit requirements are indicative. Individual lender thresholds vary. Subject to status, lender criteria, and ICR assessment.
Some lenders restrict their BTL products to specific LTV bands. A deposit of 30% or more opens a broader range of lenders and may access more competitive rates across most property types. Woodhall Mortgages confirms which lenders may consider your specific LTV, property type, and ownership structure before application.
The interest coverage ratio (ICR) is the central affordability calculation for buy to let mortgages. It measures the monthly rental income as a percentage of the monthly mortgage payment at the lender's stress test rate. The stress test rate is typically 1% to 2% above the actual mortgage rate, ensuring the property remains affordable if rates rise.
For properties held in personal names, most lenders require the monthly rent to be at least 125% of the monthly mortgage payment at their stress test rate. For a mortgage with a monthly payment of £1,000 at the stress rate, the property would need to achieve at least £1,250 per month in rent. Basic-rate taxpayers may access lower ICR thresholds with some lenders.
Properties held in a limited company (SPV) and specialist property types such as HMOs, holiday lets, and multi-unit freehold blocks typically require 145% ICR. For a mortgage with a monthly payment of £1,000 at the stress rate, the property would need to achieve at least £1,450 per month in rent. Some specialist lenders apply different thresholds.
ICR is calculated on the lender's stress test rate, not the actual mortgage rate. A property that appears affordable at the actual rate may not meet ICR requirements at the stress rate. Woodhall Mortgages confirms the stress rate for each lender before advising whether a specific property and rental income is likely to meet criteria.
Buy to let mortgage rates typically sit above equivalent residential mortgage rates. This reflects the investment nature of BTL lending: the property is not the borrower's primary residence and the mortgage is largely unregulated, meaning the lender carries different risk exposure compared to a regulated residential mortgage.
Rates vary by lender, LTV, property type, ownership structure, and whether the mortgage is fixed or tracker. Standard single-let properties at 75% LTV in personal ownership typically attract the most competitive BTL rates. Specialist types such as HMOs, holiday lets, and limited company mortgages may carry a rate premium to reflect the additional complexity and underwriting requirements.
Because BTL mortgage rates vary considerably between lenders for the same property and LTV, a whole-of-market BTL mortgage broker comparison is particularly valuable. Woodhall Mortgages compares fixed rate, tracker, and discount BTL products across a comprehensive range of lenders, accounting for arrangement fees, and identifies which may produce the best overall cost at your specific LTV, property type, and ownership structure. For current rates, speak to Woodhall Mortgages directly.
Buy to let mortgages are not a single product. The property type and ownership structure determine which lenders consider an application and what criteria apply. Each type has its own deposit requirements, ICR thresholds, and specialist lender panel.
Houses in Multiple Occupation with three or more unrelated tenants. Requires HMO licence, 30-40% deposit, and 145% ICR. Higher rental yields typically offset the higher ICR requirement.
Get HMO advice ›Property held in a Special Purpose Vehicle (SPV) limited company. Not affected by Section 24 restriction on mortgage interest relief. Requires 145% ICR. Growing lender panel.
Get Ltd Co advice ›Short-term holiday rental properties including Airbnb and Sykes Cottages listings. Assessed on projected annual rental income. Typically 30-35% deposit and specialist lender panel.
Get holiday let advice ›Landlords with four or more mortgaged properties. Subject to PRA portfolio underwriting rules requiring portfolio-wide stress testing. Specialist lenders assess the full portfolio.
Get portfolio advice ›Buildings containing multiple self-contained flats under one freehold title. Typically 30-35% deposit and specialist lender panel. Higher potential yields than single-let properties.
Get MUFB advice ›Borrowers purchasing their first buy to let property. Some lenders restrict first-time landlords who are also first-time buyers. Woodhall Mortgages identifies lenders open to new landlords.
Get first-time landlord advice ›Tax treatment depends on individual circumstances, income levels, and may change. Professional tax advice should be sought before making any investment or ownership structure decision. The information below is a general overview only.
Since April 2020, landlords who hold buy to let properties in personal names can no longer deduct mortgage interest as a business expense. Relief is restricted to the basic rate of income tax (currently 20%). For higher-rate and additional-rate taxpayers this significantly increased the effective tax cost of personal ownership compared to the pre-2017 position.
Properties held in a limited company are not affected by Section 24. Mortgage interest remains a deductible business expense for corporation tax purposes. This has driven significant growth in limited company BTL applications. However, extracting profits from the company (through salary or dividends) creates its own tax implications. Professional advice is essential before choosing a structure.
Purchasers of additional residential properties, including buy to let investments, pay a higher rate of Stamp Duty Land Tax. The additional dwelling surcharge applies on top of standard SDLT rates. The exact surcharge should be confirmed with a solicitor before exchange of contracts, as rates are subject to government change.
Whole-of-market BTL mortgage broker • All property types • No charge for initial discussion
A £299 fee is payable on a formal mortgage offer if you choose to proceed.
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Woodhall Mortgages is a whole-of-market mortgage broker. We consider a comprehensive range of mortgages from across the market, but not all lenders or products may be included. Some mortgage products are only available directly from lenders.
Most buy to let mortgages are not regulated by the Financial Conduct Authority. Regulated buy to let mortgages, where the property is or will be occupied by the borrower or a close family member, are regulated and subject to the same consumer protection framework as residential mortgages. Woodhall Mortgages is authorised and regulated by the Financial Conduct Authority. Firm reference number 762513.
Whole-of-market BTL mortgage broker. Single-let, HMO, limited company, holiday let, portfolio, and first-time landlord. We compare products across a comprehensive range of lenders and advise on the most appropriate approach for your investment.
A £299 broker fee is payable on a formal mortgage offer if you choose to proceed; this fee is non-refundable once the offer has been issued. We may also receive commission from lenders. Most buy to let mortgages are not regulated by the FCA.
Discuss Your BTL MortgageRegulatory status: Woodhall Mortgages is authorised and regulated by the Financial Conduct Authority. Firm reference number 762513. Most buy to let mortgages are not regulated by the FCA. Regulated buy to let applies where the borrower or a close family member occupies or intends to occupy the property. Verify our registration on the Financial Services Register.
Whole-of-market advice: Woodhall Mortgages is a whole-of-market mortgage broker. We consider a comprehensive range of mortgages from across the market, but not all lenders or products may be included. Some mortgage products are only available directly from lenders.
Fee: A fee of £299 is payable on receipt of a formal mortgage offer if you choose to proceed. This fee is non-refundable once the offer has been issued, whether or not the mortgage completes. We may also receive commission from lenders; the amount will be disclosed before you proceed.
Vulnerability: If your circumstances involve financial difficulty, ill health, recent bereavement, caring responsibilities, language difficulties, or any other situation that may affect how you take in information or make decisions, please let us know. We can adapt how we communicate with you.
This is a financial promotion intended for UK consumers. This page is for information purposes only and does not constitute regulated mortgage or tax advice. Last reviewed: May 2026. Woodhall Mortgages, Croft Myl, West Parade, Halifax, West Yorkshire, HX1 2EQ.
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