Mortgages sized on what the property earns.
Buy-to-let lending works differently from a residential mortgage: the rent does the heavy lifting, not your salary. Getting the structure right at the start is worth more than shaving a tenth off the rate.
Rent, not salary, decides what you can borrow
A What this meansA mortgage on a property you rent out rather than live in. Lenders size it on the rent the property earns rather than your salary. lender applies a What this meansThe test a buy-to-let lender applies: the rent must exceed the mortgage payment by a set margin — often 125% to 145% — at an assumed interest rate. It decides how much you can borrow. test — the rent must exceed the mortgage payment by a set margin at an assumed rate. That calculation, not the asking price, usually sets your ceiling.
The other early decision is ownership: personally, or through a limited company. Since tax relief on mortgage interest was restricted for individuals, company structures have become common for higher-rate taxpayers — but they carry their own costs and are not automatically better. This is a conversation for you, your accountant and us together, before you buy.
What we arrange
Single properties through to portfolios, in personal names or through a company.
Typically a good fit when
- First buy-to-let purchases and remortgages
- Limited company (SPV) buy-to-let, including newly incorporated companies
- HMOs and multi-unit freehold blocks, where rental yields are higher and lenders fewer
- Portfolio landlords, where lenders stress-test the whole portfolio rather than one property
- Semi-commercial property — a shop with flats above sits with commercial lenders
Where the real cost sits
Buy-to-let rates are usually higher than residential ones, and arrangement fees are often a percentage of the loan rather than a flat sum — a 3% fee on £300,000 is £9,000, which changes the comparison between two products completely.
Compare on total cost over the fixed period, not the headline rate. A lower rate with a percentage fee frequently loses to a slightly higher rate with a flat one.
Questions we are asked most
How much deposit do I need for a buy-to-let?
Usually 25% of the value, with better rates available at 40%. What you can borrow is then capped by the What this meansThe test a buy-to-let lender applies: the rent must exceed the mortgage payment by a set margin — often 125% to 145% — at an assumed interest rate. It decides how much you can borrow. calculation, so on a low-yielding property the rent may limit you before the deposit does.
Should I buy through a limited company?
It depends on your tax position, how long you intend to hold, and whether you need to draw the income. Higher-rate taxpayers building a portfolio often benefit; a basic-rate taxpayer with one property frequently does not.
It is a tax question before it is a finance question, so take advice from your accountant. We will tell you how lenders and rates differ between the two, and make sure the mortgage fits whichever structure you choose.
Can I get a mortgage on a property that needs work?
Not usually, if it is currently unlettable — no kitchen or bathroom, or serious disrepair. The common route is bridging finance to buy and refurbish, then a buy-to-let mortgage on the finished, revalued property.
Weighing up a purchase?
Send the price and the expected rent and we will tell you what borrowing it supports.
Or email info@nemekfinance.co.uk · Call 07483 159369
No obligation, no credit check to talk, and a straight answer if finance is not the right move.