Let to Buy Mortgages Guides & Advice

Let to buy generally describes retaining and renting out your current home while purchasing a new main residence. The existing property is usually moved onto a suitable buy to let mortgage, while a separate residential mortgage funds the new home. Both applications must work together, and the expected rent, equity, affordability and timing are important. Consent from the existing lender is required if the mortgage is not replaced immediately.

A standard buy to let purchase usually involves buying an investment property. Let to buy starts with a home you already own and wish to retain as a rental when you move. This can involve simultaneous residential and buy to let applications, release of equity and additional property tax. The financial and administrative position is often more complex than a single buy to let purchase.

It may be possible to remortgage the existing property and release equity, provided sufficient value remains and the new buy to let loan meets rental coverage and loan-to-value requirements. The residential lender must also accept the source of deposit and overall commitments. Releasing equity increases borrowing and costs, so ensure both properties remain affordable under realistic rental and interest assumptions.

The lender for the retained property normally assesses expected market rent through a valuation and applies its rental stress calculation. Some residential lenders may treat the old mortgage as self-financing if the rent meets specified criteria; others may include a commitment or require additional evidence. Criteria differ considerably, so both sides of the transaction should be planned together.

Yes. You must not let a mortgaged property without the lender's permission. Depending on your plans, the lender may grant temporary consent to let or require a switch to a buy to let mortgage. Consent to let can be restricted, time-limited or subject to charges. You must also inform the insurer and comply with landlord obligations before tenants move in.

Buying a new home while retaining another property may attract higher rates of property transaction tax, depending on the jurisdiction and circumstances. A later sale of the former home may permit a refund in some cases and within specified timescales. Tax rules can change and mortgage advisers do not provide tax advice, so obtain confirmation from a qualified tax adviser or conveyancer before exchange.

Limited equity can make let to buy difficult because the existing property must usually remain within the buy to let lender's maximum loan-to-value, while enough funds are needed for the new purchase deposit and costs. A strong rental figure does not replace the equity requirement. Alternative options may include selling, saving a larger deposit or delaying the move.

You become responsible for two properties and mortgages, with exposure to void periods, repairs, rate changes and potential falls in property values. The sale and purchase timing can also create practical and financial pressure. Landlord legal duties, tax and insurance apply to the retained property. A contingency fund and realistic affordability assessment are essential before proceeding.