How Much Can I Borrow Buy to Let Mortgage
How much you can borrow on a buy to let mortgage depends less on your salary than on the rent the property earns. Lenders start with the loan-to-value limit, often 75%, and then check that the rent covers the mortgage payment by a set multiple after a stress test. The lower of those two limits is usually the real answer.
Take a £200,000 property with a 25% deposit: the LTV limit allows a £150,000 loan. If the rent is £1,000 a month and the lender requires rent to cover 145% of the payment at a stressed rate of, say, 8%, the payment on £150,000 at 8% is £1,000 a month, so the rent only just covers it and the lender may cap the loan lower. Stronger rent means a larger loan; weaker rent means a smaller one.
Your personal income still matters. Some lenders require a minimum income, often around £25,000, and your credit history and existing mortgages affect the decision. If the numbers do not work on one property, a larger deposit or a higher-rent property are the two levers that move the result most.
- LTV limit and rent cover limit both apply; the lower one wins.
- Lenders usually stress test at a rate above the product rate.
- A bigger deposit or higher rent increases the amount you can borrow.
Try the free calculator to work out your own figures in seconds.