Best mortgage deals for buy-to-let investors

Published by The Moneywise Team on 03 August 2015.
Last updated on 04 April 2018

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, 1.91%
Fixed until 30 April 2020, then reverts to SVR (currently 4.99%)

Post Office Money has the cheapest two-year fixed rate deal charging interest at 1.91% with fees of £495 after cashback. Monthly interest only repayments are £298. For the first two years, an annual cost of £3,829. Once the fixed rate expires the SVR of 4.99% kicks in. 

Principality Building Society, up to 75% LTV, 2.55%
Fixed until 30 June 2023, then reverts to SVR (currently 4.9%)

This five-year fixed mortgage has monthly repayments of £398. This includes £1,775 of fees and gives a total annual cost of £5,136. 

Monmouthshire Building Society, up to 75% LTV, 1.7%
3.29% discount for two years, then reverts to SVR (currently 4.99%)

If you’re willing to take your chances with a variable rate mortgage then Monmouthshire Building Society offers this deal. There are fees of £1,287 and monthly payments are £266 - equivalent to £3,831 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. 

Virgin Money, up to 60% LTV, 1.54%
Fixed until 1 July 2020, then reverts to SVR (currently 4.99%)

This deal has a rate of 1.54%, fixed until 2020, meaning it’ll cost £193 per month to borrow £150,000. Borrowers will need to pay £459 in upfront fees, after cashback. The annual cost is £2,540. 

Virgin Money, up to 60% LTV, 2.22%
Fixed until 1 July 2023, then reverts to SVR (currently 4.99%)

For a longer fix, this rate is guaranteed until 2023. The total monthly cost is £278 per month, meaning the annual total is £3,422. Borrowers must pay fees of £459 with this loan, after £750 cashback. 

Principality Building Society, up to 60% LTV, 1.8%
3.1% discount until 30 June 2020, then reverts to SVR (currently 4.9%)

Principality comes out on top of the variable deals. Repayments are £225 per month with no fees, meaning a total cost of £2,700 per year.

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