Best mortgage deals for buy-to-let investors

Published by Adam Williams on 03 August 2015.
Last updated on 26 September 2017

If you’re looking to invest, or rearrange a mortgage on a buy-to-let property, how do you pick the right deal for your circumstances?

Many people are looking towards the property market as they seek higher returns than those offered by traditional savings accounts and other forms of investment.

Buy-to-let investors often get mortgages on an interest-only basis - though repayment options are available if that is appropriate for your circumstances. Remember while property prices have risen in the last few years, there is no guarantee that values will keep increasing.

Our Moneywise Best Buys are selected based on someone borrowing on an interest-only basis against a £250,000 property for 20 years, at either 60% or 75% loan to value (LTV). Our buyer is paying all fees up front.

Top buy-to-let mortgages at 75% LTV

There are a range of options for borrowers with a 25% deposit with rates at historic lows, here are our buy-to-let Best Buys this week.

Post Office Money, up to 75% LTV, 1.88%
Fixed until 30 November 2019 then reverts to SVR (currently 4.74%)

Post Office Money has the cheapest two-year fixed rate deal charging interest at 1.88% with fees of £695 after cashback. Monthly interest only repayments are £294 for the first two years, an annual cost of £4,028. Once the fixed rate expires the SVR of 4.74% kicks in. 

The Nottingham Building Society, up to 75% LTV, 2.75%
Fixed until 1 December 2022 then reverts to SVR (currently 6.29%)

The Nottingham comes out top of the five-year fixed rate deals. This has a headline rate of 2.75% until 2022. Monthly repayments are £430, representing an annual cost of £5,419. The fees here are £999. 

Virgin Money, up to 75% LTV, 1.99%
Bank of England base rate (currently 0.25%) plus 1.74% until 1 January 2020 then reverts to SVR (currently 4.74%)

If you’re willing to take your chances with a variable rate mortgage then Virgin Money offers this deal. There are fees of £1,209 with £500 cashback and monthly payments are £311 - equivalent to £4,086 per year.

Best buy-to-let deals at 60% LTV

Deals are more attractive with a 40% deposit and many rates are available for well under 2%. You’ll need to remember to factor in the fees, which in some cases makes the total cost much more expensive. 

Platform, up to 60% LTV, 1.49%
Fixed until 30 September 2019 then reverts to SVR (currently 5%)

This deal has a rate of 1.49%, fixed until 2019, meaning it’ll cost £186 per month to borrow £150,000. Borrowers will need to pay £928 in upfront fees, after cashback. The annual cost is £2,699. This product is only available through a mortgage broker.

BM Solutions, up to 60% LTV, 2.09%
Fixed until 30 September 2022 then reverts to SVR (currently 4.84%)

For a longer fix, this rate is guaranteed until 2022. The total monthly cost is £261 per month, meaning the annual total is £3,590. Borrowers must pay hefty fees of £2,450 with this loan, with no cashback. This product is only available through a mortgage broker.

Virgin Money, up to 60% LTV, 1.54%
Bank of England base rate (currently 0.25%) plus 1.29% until 1 January 2020 then reverts to SVR (currently 4.74%)

Virgin Money comes out on top of the variable deals. Repayments are £193 per month with fees of £709, after cashback. That’ll cost £2,665 per year.

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Call free on 0800 073 1936 or see mortgage best buys online.