Skip to content
    First Rung Now
    First Rung Now
    UK Mortgage Guides
    Speak to a Vetted Broker

    UK Mortgage Guide

    Let to Buy Mortgage Providers: Who Lends and How

    Let-to-buy is one of the most useful and misunderstood mortgage structures in the UK. It lets you keep your current home as a rental investment while moving to a new main residence — turning the property you used to live in into the start of a small property portfolio. The mechanics are well-trodden but require coordinating two lenders simultaneously, navigating an extra slice of stamp duty, and getting the rental coverage maths right. This guide walks through which UK lenders are most active in this market, how the deal actually fits together, and the practical considerations that decide whether let-to-buy is a smart move for your circumstances.

    First Rung Now Editorial Updated 15 June 2026 7 min read

    How let-to-buy actually fits together

    The structure has three moving parts that complete simultaneously. First, you remortgage your current home from a residential mortgage onto a buy-to-let mortgage with a new (or sometimes the same) lender. Most BTL remortgages release some equity at the same time — bringing the new BTL LTV up to around 75%. Second, you use the released cash plus your savings as the deposit for the new residential property. Third, you take a residential mortgage on the new property with a separate (or sometimes same) lender, and complete the purchase.

    The coordination is the hard part. Three completions need to align on the same day: BTL remortgage funds release on the old home, deposit transfers to the new home, residential mortgage funds release. Most experienced brokers and conveyancers can manage this, but it requires deliberate planning across the chain — particularly if the new home purchase has its own chain attached.

    BTL side: which lenders to look at

    Several BTL lenders specialise in or are particularly competitive on let-to-buy applications. BM Solutions (part of Lloyds) is the largest UK BTL lender and is well-versed in let-to-buy structures. Their criteria are straightforward and their service is fast. The Mortgage Works (TMW) — part of Nationwide — is another major name, particularly competitive on portfolio landlords and personal-name BTL.

    Paragon Bank is the leading specialist BTL lender, particularly strong on limited company BTL, complex landlord profiles, and HMO conversions. Aldermore is well-known for taking flexible views on let-to-buy applicants who are accidental landlords (those keeping the old home because they're moving for work, not for investment reasons).

    Coventry for Intermediaries is competitively priced on standard let-to-buy where the applicant has a clean profile. Accord (part of Yorkshire Building Society) is also active, with particularly competitive rates on standard residential property types. Precise and Birmingham Midshires round out the specialist names commonly used.

    Residential side: lender choice

    The residential side of let-to-buy is technically straightforward — you're taking a residential mortgage on a new home. Almost any lender that does residential mortgages will accept an existing BTL property in the background, provided you can demonstrate the BTL is self-supporting (rental income covers the BTL mortgage payment plus a buffer).

    The key consideration is how the lender treats the existing BTL in affordability calculations. Some lenders (Halifax, Nationwide, Santander) treat self-supporting BTLs as financially neutral — the rent covers the cost, so it doesn't reduce your residential affordability. Others apply a small deduction or require evidence of a rental buffer.

    If you have multiple BTL properties — i.e. you're a portfolio landlord — many residential lenders apply stricter background portfolio assessments. The four or more property threshold often triggers full portfolio stress testing. Brokers usually steer portfolio applicants towards lenders who handle this routinely, such as TMW, Coventry, Halifax and Skipton.

    The stamp duty position

    Stamp duty on the new residential purchase attracts the 5% additional rate surcharge because you'll own two properties at completion. On a £400,000 new home, the surcharge alone adds £20,000 to the tax bill versus a single-property purchase.

    The good news: if the original property was your main residence and you sell it within 36 months of completing on the new home, you can claim a refund of the surcharge. This catches many let-to-buy borrowers who originally intend to keep the old property as a long-term BTL but later decide to sell. The 36-month window is generous.

    If you're confident from the outset that the old property will remain a long-term rental, the surcharge is a fixed cost of the strategy and should be factored into the deal economics.

    Rental coverage on the BTL side

    BTL mortgages are sized based on the property's rental income, not your salary. Lenders calculate an Interest Coverage Ratio (ICR) — the rent must exceed the stressed mortgage interest by 125% (basic-rate taxpayers) or 145% (higher-rate taxpayers) at a stressed interest rate of typically 5.5%–7%.

    Worked example: a property valued at £250,000 with a 75% LTV BTL mortgage of £187,500. At a stressed interest rate of 6% over 25 years on interest-only, monthly interest is £937. For a higher-rate taxpayer at 145% ICR, the required monthly rent is £1,358. If the property would only rent for £1,150, the lender will reduce the maximum loan accordingly.

    This is the most common reason let-to-buy applications fail to deliver the desired equity release — the rental income doesn't support the BTL loan size needed to fund the new deposit. Always run rental coverage numbers before committing to the strategy.

    When let-to-buy is the right strategy

    Three scenarios consistently make let-to-buy attractive. The first is the "accidental landlord" scenario — you've been offered a job in a new area, your current home would be difficult to sell quickly or in a buyer's market, but rental demand is strong. Let-to-buy lets you preserve optionality.

    The second is the deliberate property investor strategy — you're moving up the housing ladder and want to start building a rental portfolio by retaining each former home as a BTL. Done over 2–3 moves, this builds a substantial portfolio without ever having to find separate BTL deposits.

    The third is the "best of both worlds" scenario for couples upsizing — neither party wants to sell their existing property because the rental return is strong and the long-term capital appreciation is expected, but they want to live together in a larger home.

    Conversely, let-to-buy is a poor choice when the rental wouldn't comfortably cover BTL costs, when you're already at the edge of overall affordability across two properties, or when the additional stamp duty surcharge meaningfully damages the deal economics.

    Your home may be repossessed if you do not keep up repayments on your mortgage. First Rung Now is not FCA authorised or regulated; we introduce consumers to FCA-regulated mortgage brokers. Nothing in this article is financial advice.

    Frequently asked questions