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What deposit do I need for a Buy to Let Mortgage?

A recent survey by the Office of National Statistics found that 42% of people felt buy to let was ‘The secret’ to ensuring a comfortable retirement income. It’s not surprising that the market is rapidly expanding being predicted to treble by 2032 when you consider the increasing opportunities to purchase more lucrative rental properties such as Houses in Multiple Occupation (HMOs) and in the knowledge that nearly 20% of current landlords said they are expecting to buy more property. It therefore seems increasingly appealing to make such an investment to secure your future. But just how big of a deposit would you need to make to on a property with a buy to let mortgage?buy to let mortgage deposit

How can I get a buy to let mortgage?

The first thing you need to understand is that mortgage lenders tend to ask for a higher deposit for buy-to-let than on a standard mortgage. Although it is possible to get a buy-to-let mortgage with a deposit of as little as 15% of the property’s value, these are uncommon and the interest rates expected on such an investment are likely going to be considerably higher than you will want to pay. Lenders also often reserve these products for landlords who already have a lot of experience in the buy to let market. 

If you are new to buy-to-let investments, you may be able to find a mortgage with a deposit as low as 20% however by putting down 25% of the property’s value you will find that mortgage lenders offer considerably more competitive interest rates, currently starting at around 3% and even throw in some incentives to borrow from them.


What will the lender look at when I apply?

During a mortgage application many lenders take into consideration other factors than just the value of the property and may tailor your specific minimum deposit requirement based on numerous other factors such as;

  • Whether you already own a property - Some lenders may not even offer buy to let opportunities to non-homeowners. 
  • How much you earn – If you are not already a homeowner you may find it difficult to find a suitable buy to let mortgage if your current earnings total less than £25,000 a year. 
  • The proposed rental income of the property.
  • Your age – Many lenders are reluctant to offer mortgages to borrowers who will be over 70 years old by time the mortgage term finishes, others are happy to accept applications from people aged over 70 as long as they will be less than 85 when the loan is set to be repaid. 

What else do I need to consider?

If you are thinking about applying for a buy-to-let mortgage as well as the deposit you also need to consider any additional fees which again are usually higher than you might be used to with a normal mortgage. What is the total you need to pay going to be once you have included the arrangement fees? You should also at this point think about managing the property, are you happy to find tenants yourself and respond to their maintenance requests? Or are you going to pay an agency to do this for you? Also consider putting some money aside for any interim empty periods between tenants.


If you have taken all of this on board and you are confident you are in a good position to take on a buy-to-let mortgage then it is important to shop around. Remember once you have compared all the different offers and rates and taken into account arrangement fees you are likely to find that what initially seemed like the best deal may not be in the long term.

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The above mortgage products highlighted on this website are available directly through lenders who will be able to provide further information about the product you are interested in. If you are unsure about what mortgage product is suitable for you, we suggest you speak to an independent mortgage broker