How do Buy to Let mortgages work?

• Research the types of Buy to Let mortgages available, your repayment options and associated costs.
• Other costs involved in buying a house include valuation fees, legal fees and Stamp Duty. 

The following criteria applies for NatWest Buy to Let mortgage applications:

• You're a UK resident aged 18 or over.
• You have/will have less than four Buy to Let or consent to let properties with a mortgage. This includes the property that you are purchasing or remortgaging and excludes any residential mortgages.
• Your expected rental income to be at least 125% of your monthly interest payments.
• You have at least 25% of the purchase price of the property as a deposit.
  
• It's a UK property worth at least £50,000 and has the minimum EPC rating required depending on where it is located. See further details.
• You're borrowing at least £25,000 over a minimum of 3 years and a maximum of 35 years.
• Your total aggregated borrowing with NatWest group brands will be less than £3.5 million.

We will not consider multiple tenancies, Homes of Multiple Occupancy (HMO), bedsits, ‘Related Person’ tenancies, properties that fall under a selective licensing scheme or properties that will be used as a holiday home or holiday let.

You cannot apply for a Buy to Let mortgage with us if you do not meet the above criteria.

Check whether you meet our Buy to Let mortgage eligibility.

If you already have a mortgage on the property, look at the latest mortgage statement you received from your current mortgage provider to see how much is left to pay.

If your property isn't already on Standard Variable Rate (SVR) then you might have an Early Repayment Charge (ERC) if you remortgage. Check your mortgage paperwork or contact your current mortgage provider to find out whether ERC's are applicable to you.

• Costs, rental income and rental tenancy demand will vary by area.
• Research can help you make a more informed choice if you decide on a Buy to Let property.
• You may also want to consider whether a property is freehold or leasehold. This could affect whether the property can be rented.
• Now you can start looking for the property that best suits your needs and your potential tenants' needs. 
• If you're looking to buy further afield, you might want to consider using a letting agent to manage the property on your behalf.

• Understand what your rental income could be.
• Consider all the costs of renting out a property and calculate your rental yield.
• Costs may include mortgage payments, bills, maintenance, insurance and agent fees. Plus, covering costs for periods when the property may be vacant.

• Choose from a fixed rate or tracker rate (currently not available with NatWest). There are also interest only or capital repayment mortgages. All have pros and cons.
• Compare different types of mortgages and find out what we could offer you. Use our mortgage rate finder to understand monthly repayments.

Enter a few details into our mortgage rate finder and we’ll show you all the NatWest mortgages that could be right for you, based on what you've told us.

Thinking of borrowing more? No problem, it's easy to vary the amounts in the calculator.

Whether you are purchasing or remortgaging, you’ll need to get an Agreement in Principle to see if we think we may be able to lend you the amount you require.

This isn't a firm decision, but it’s the most accurate result we can give you without performing a full credit check.

Our Agreement in Principle:

• Provides a personalised indication of how much we could lend you.
• Will not impact your credit score as we use a soft credit check.
• Takes less than 10 minutes and there is no commitment.

Once you've got your Agreement in Principle, you can see the rates available to you and find out what your monthly payments could be.

Log in and retrieve your Agreement in Principle if you saved it. Otherwise you'll need to a new one before you can apply for your mortgage.

You'll then see the mortgage rates available to you. Select the mortgage that you want, to see a personalised mortgage illustration and start the application form.

Learn about our mortgage types

Once you've completed the mortgage application, we'll hold your rate for 14 days whilst you upload your supporting documents such as bank statements and proof of identity. We'll confirm the documents you need to provide once you've completed the application form.

Once you've uploaded your supporting documents and completed all the tasks on your mortgage dashboard, your mortgage application will be submitted.

If you are applying for a joint mortgage, then the 2nd applicant will receive an email with details on the documents that they will also need to upload onto their own mortgage dashboard.

We'll then complete the normal affordability and credit checks before finalising your mortgage offer. 

You may need to pay Stamp Duty when purchasing a Buy to Let. This is also known as 'Land and Buildings Transaction Tax’ in Scotland and ‘Land Transaction Tax’ in Wales.

You should also consider whether you need to pay Capital Gains Tax or Income Tax on your rental income. The GOV.UK tax website is a good place to find more information, as there may be other taxes to consider.

If you are the landlord of a Buy to Let property, you can't live there if it was purchased with a Buy to Let mortgage. Doing this would breach the mortgage terms, and your lender could ask for the mortgage loan to be repaid.

Yes, if you wish to leave your Buy to Let empty, there shouldn't be any issue, as long as you continue to pay your mortgage payments.

Yes, Buy to Let mortgages can be more expensive than residential mortgages. They tend to have higher interest rates and usually require a larger deposit. With NatWest, you’ll need at least a 25% deposit for a Buy to Let mortgage.

Try our rental yield calculator to work out your yearly returns before you apply.

It is relatively common for people to change residential mortgages to Buy to Let. If you have a NatWest residential mortgage, it's best to contact us to understand if this could be an option for you.

This will depend on a number of factors, including your existing mortgage type and existing mortgage terms.

Working out the rental yield of your property helps you understand what rent to charge to ensure your Buy to Let investment is profitable. You can work out your rental yield by using the following calculation:

1. Multiply your monthly rental income by 12 (months in a year).
2. Minus any annual costs of owning the property e.g., mortgage payments, insurances, fees.
3. Divide that by the purchase price of the property or the current market value.
4. Multiply the figure by 100 to get a percentage.

Or use our rental yield calculator.

You can also use sites like Zoopla to get an idea of how much similar properties are being let out for.

Yes, if you're a first time buyer it may be possible to get a Buy to Let mortgage with NatWest, as long as you meet the other Buy to Let mortgage eligibility criteria.

No, we do not currently lend for House in Multiple Occupation (HMO) properties, or properties that may be classed as a HMO.

NatWest do not currently offer Buy to Let mortgages on holiday homes. Our current policy is not to lend on properties intended to be used as a holiday home with a Buy to Let mortgage.