Published: 29/01/2019

At a glance

  • You’ll need to arrange a buy-to-let mortgage on your property. This can be from your existing residential mortgage provider or another lender.
  • You can either manage the property yourself or have a letting agent handle things like finding new tenants and coordinating repairs/maintenance, etc.
  • You’ll still be expected to meet mortgage repayments even if your property is empty.

1. Speak to your mortgage lender

If you already have a mortgage on your property but wish to convert it to buy-to-let, it's important to speak to your mortgage lender. You're not allowed to move tenants into your property without your lender granting what is known as "consent to let".

There will be a fee charged for getting consent. It could be the case that you can remain on the same mortgage rate that you are currently on, but it's more likely that you will have to go onto a specific buy-to-let mortgage rate.

If this is the case, it's worth seeing what your existing lender can offer and compare this to other mortgages for first-time landlords (you might find that speaking to a mortgage broker will also be of help).

2. Are you going to manage your buy to let?

If you're not confident managing your property and tenants directly, a letting agent can be a great help. Be sure to get quotes from several agents for managing your property, but when it comes down to it, it's the agent you feel most comfortable with, not price that's most important.

A letting agent has that specialist knowledge that can help you get your property ready to rent. This includes looking at important details such as making sure your Gas Safe inspections are up-to-date and ensuring any electrical appliances you leave for the use of tenants are PAT tested.

It's always better to go for a letting agent that's a member of the Association of Residential Letting Agents (ARLA): see www.arla.co.uk. ARLA members must adhere to certain professional standards, as well as following a strict code of practice.

Buy to let rental yield calculator

Our buy to let rental yield calculator shows how much your rental yield might be based on your property's value and expected rent.

3. Don't forget landlord insurance

When you become a landlord you need to have specialist landlord insurance on the property, not the buildings insurance you'd normally have.

4. Consider talking to an accountant

Buy-to-let is an investment, and you will have to pay taxes regarding the property. Talk to an accountant or tax professional about what you might have to pay. If you’re unsure, your letting agent may be able to put you in touch with a specialist in this field.

5. Are you happy with the investment risks?

Bricks and mortar are normally considered a safe bet, but it’s important to remember that a buy-to-let property is an investment. This means that you could lose money as well as make it. To start off, read our guide to buy-to-let investment risks. If you're still unsure, speak to a financial adviser.

Pros and cons of being a buy-to-let landlord:

  • Property is still seen as a relatively safe long-term investment.
  • By renting, you can generate an income from your property to pay the mortgage and any additional costs.
  • You can offset some of your expenses and costs against tax (make sure you consult a tax professional).
  • You’ll have to be able to pay the mortgage even if your property is empty.
  • Stamp duty is higher on buy-to-let properties than those for simple residential use.
  • You will be responsible for maintaining the property in good condition, as well as ensuring that it meets all the legal requirements for landlords (Gas Safe inspections, electrical PAT testing, etc.).

Moneyfacts tip

Moneyfacts tip Leanne Macardle

You don’t have to stay with your existing residential mortgage provider when becoming a landlord – don’t be afraid to shop around for the best buy-to-let mortgage deals for your needs.

Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

close up of metal keys on red background

At a glance

  • You’ll need to arrange a buy-to-let mortgage on your property. This can be from your existing residential mortgage provider or another lender.
  • You can either manage the property yourself or have a letting agent handle things like finding new tenants and coordinating repairs/maintenance, etc.
  • You’ll still be expected to meet mortgage repayments even if your property is empty.

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