How to Get a Buy-to-Let Mortgage as a First-Time Investor

Thinking about becoming a landlord? Learn how buy-to-let mortgages work, what deposit you need, and how Mortgage Knight helps first-time investors find the right lender.

Becoming a landlord can be one of the smartest ways to grow long-term wealth — but your first buy-to-let mortgage might feel a bit different from your residential one.

Whether you’re buying your first rental property or switching an existing home to let, this guide will explain how buy-to-let (BTL) mortgages work, what lenders look for, and how Mortgage Knight helps first-time investors make confident choices.

What Is a Buy-to-Let Mortgage?

A buy-to-let mortgage is designed for properties that will be rented out, rather than lived in by the owner.

Unlike residential mortgages, BTL products are assessed primarily on rental income potential, not just personal earnings.

In simple terms — if the rent covers the mortgage with a comfortable margin, you’re likely to qualify.

How Lenders Assess a Buy-to-Let Application

Lenders use two key tests:

Rental Coverage Ratio (ICR):

Rent usually needs to cover 125%–145% of the monthly mortgage payment.

Stress Test Rate:

Lenders test your mortgage against a notional rate (around 5.5%) to make sure it remains affordable if rates rise.

Example:

If your mortgage payment is £800, lenders may require £1,000–£1,160 monthly rent to qualify.

Some also consider your personal income (often a minimum of £25,000–£30,000), though not all.

Deposit and Loan-to-Value (LTV)

For a buy-to-let mortgage, you’ll typically need a 25% deposit.

However, a few lenders will go as low as 20% for strong applicants.

Higher deposits unlock better rates, improve cash flow, and make remortgaging easier later.

Example:

Property value: £200,000
25% deposit: £50,000
Mortgage: £150,000

First-Time Landlords — Common Requirements

Even if you’ve never owned an investment property, many lenders now welcome first-time landlords.

You may just need to show:

A clean credit history
Stable employment or income
Evidence that rent will meet affordability
A property in good condition and rentable area

Mortgage Knight works with lenders who specialise in first-time investors, so you can start your journey confidently.

Types of Buy-to-Let Mortgages

Standard Buy-to-Let

The most common option — for single residential properties rented to one household.

Limited Company Buy-to-Let

Your property is owned through a company (often “SPV Ltd”), which can offer tax advantages for higher-rate taxpayers.

We can help set this up and source lenders comfortable with SPVs.

HMO (House in Multiple Occupation)

For properties rented to three or more unrelated tenants.

These need specialist lenders and sometimes a licence, but can offer higher yields.

Holiday Let Mortgages

If you plan to rent short-term via Airbnb or similar platforms, you’ll need a holiday let mortgage — available from lenders like Landbay, Leeds Building Society, and Cumberland.

How Mortgage Knight Helps First-Time Investors

Buy-to-let lending can vary wildly between banks — from how rental income is calculated to which property types are accepted.

At Mortgage Knight, we:

Compare over 90 UK lenders, including Landbay, The Mortgage Works, and Precise
Understand complex rental scenarios and yield-based lending
Handle application paperwork and portfolio planning for smooth approval

Whether it’s your first rental or the start of a portfolio, we’ll guide you through every step.

Case Studies

Case Study 1: Jordan – First Buy-to-Let in Manchester

Jordan bought a £160,000 flat to rent to young professionals. We arranged a 5-year fixed BTL mortgage with Landbay, with a 25% deposit and no issues as a first-time landlord.

Case Study 2: Anna – Turning Her Home into a Rental

Anna relocated for work and wanted to rent her old home. Mortgage Knight secured a “Let-to-Buy” mortgage, letting her release equity and buy her new home simultaneously.

Case Study 3: Peter – Higher-Rate Taxpayer Using a Limited Company

Peter purchased a £300,000 house via an SPV Ltd setup. We sourced a limited company BTL mortgage with Shawbrook, improving his long-term tax position and yield.