How much deposit do you need for a buy-to-let?
Less than most people think. Lenders on our panel go up to 80% loan to value on a standard buy-to-let, so a 20% deposit works, and selected products go to 85%. See 80% LTV buy-to-let mortgages. The deposit you need depends far more on the type of property than on the lender's headline:
| Property | Max LTV | Smallest deposit |
|---|---|---|
| Single buy-to-let (house or flat) | 80% (85% on selected products) | 15–20% |
| HMO | 80% | 20% |
| Multi-unit freehold block | 80% | 20% |
| Semi-commercial / mixed-use | 75% | 25% |
| Commercial | 75% | 25% |
HMOs and blocks are often assumed to need 25–30% down. They don't: several lenders on our panel lend to 80% on both, although they usually want some landlord experience first. See HMO mortgages. The rent still has to pass the lender's rent test at whatever LTV you choose. Check it in the buy-to-let mortgage calculator.
Where can the deposit come from?
Lenders don't only ask how much you're putting in; they ask where it came from. Criteria vary a lot from lender to lender, so the summaries below reflect the most flexible lenders we work with, not the strictest.
Your own savings
The simplest source. Expect to show bank statements covering how the money built up.
Equity from another buy-to-let
Remortgage or take a further advance on a property you already let, and use the cash as the deposit. That property's rent has to support its own bigger loan.
Equity from your own home
Remortgaging your home to fund a deposit is accepted by most lenders. It is a regulated mortgage on your home, so it needs advice in its own right, and your home is at risk if you can't keep up the payments.
Sale of another property
Proceeds from a sale, completed or exchanged, with the completion statement as evidence.
Gift from family
A gifted deposit from a family member, with a signed gift letter confirming it is not a loan and the donor has no interest in the property. Some lenders accept gifts into a limited company too.
Director's or intercompany loan
For a limited company purchase, funds lent into the SPV by its directors, or by a parent or sister company, are accepted by some lenders, provided the loan is documented and not secured on the property.
Company reserves
Retained profits or working capital in a trading or property company can fund a purchase in that company, with accounts and bank statements as evidence.
Gifted equity
Buying from a family member below market value, with the discount treated as your deposit. Not every lender accepts it, and the valuation has to support the full value.
Overseas funds
Accepted with clear source-of-funds evidence. Expect more questions on where the money came from and how it reached the UK.
Builder or vendor incentives
Usually capped at around 5% of the price, and the lender reduces the maximum loan to match.
Borrowed deposit
Personal loans, credit cards and other unsecured borrowing are declined by most lenders, and any repayments count against your affordability.
Cryptocurrency
Only a few lenders accept it, and only once it has been cashed out with a clear trail back to the original purchase.
Can you get a 100% buy-to-let mortgage?
Not as a single loan: no mainstream lender lends 100% of a rental property's value. But you can buy with no cash of your own by putting equity you already own to work:
- Release equity from another property. Remortgage your home or an existing buy-to-let to raise the deposit and costs. The new purchase is then mortgaged at 75–80% in the normal way.
- Offer additional security. Some specialist and short-term lenders will take a charge over another property instead of a cash deposit.
- Buy, improve, refinance. Buy with short-term finance or cash, add value with works, then refinance onto a buy-to-let mortgage on the new valuation. Done well, this can pull most or all of your money back out. See remortgaging within six months of purchase.
Borrowing 100% of the cost leaves no margin if values fall or rents drop. It suits experienced landlords with strong rental cover, not first purchases.
Remortgaging within six months of buying
You don't have to wait six months to refinance on what the property is now worth. Some lenders on our panel will remortgage within six months on today's value without any works, and many more will once improvement works are done and evidenced. Always subject to the lender's underwriting and valuation. Remortgage on today's value →
What evidence lenders ask for
- Bank statements, usually the last 3–6 months, showing the deposit and how it built up.
- A signed gift letter and the donor's ID and statements for a gifted deposit.
- A loan agreement and company accounts for a director's or intercompany loan.
- A completion statement or mortgage offer where the funds come from a sale or a remortgage.
Large or unexplained deposits slow a case down more than anything else. Get the paper trail together before you apply.
Other buy-to-let mortgage requirements
- Rent cover: rent typically has to cover the interest by 125% (limited companies and basic-rate taxpayers) or 145% (higher-rate taxpayers), at a stressed rate.
- Personal income: some lenders want around £25,000 a year. Many specialist lenders have no minimum.
- Credit history: recent missed payments, defaults or CCJs narrow the options, but specialist lenders do consider them.
- Experience: first-time landlords can borrow, but from fewer lenders. HMOs and blocks at the highest LTVs usually need landlord experience.
- How you buy: personally or through a limited company, which has different rent tests and tax treatment.
Frequently asked questions
What is the minimum deposit for a buy-to-let mortgage?
20% on most property types, and 15% on selected products for a standard buy-to-let. HMOs and multi-unit blocks can also be done at 80% loan to value, so 20% down.
How much deposit do I need for an HMO?
As little as 20%. Several lenders lend up to 80% loan to value on HMOs, although they usually want landlord experience and the rent must pass their rent test.
Can I use a gifted deposit for a buy-to-let?
Yes, most lenders accept a gift from a family member with a signed gift letter confirming it is not a loan. Some also accept gifts into a limited company.
Can a limited company use a director's loan as the deposit?
Some lenders accept a director's loan or a loan from a parent or sister company into the SPV, provided it is documented and not secured on the property.
Can I remortgage my home to fund a buy-to-let deposit?
Yes, most lenders accept equity released from your home or another property. Remortgaging your home is a regulated mortgage, and your home may be repossessed if you do not keep up repayments on it.
Can I get a 100% buy-to-let mortgage?
Not as one loan, but you can buy with no cash of your own by releasing equity from another property, offering additional security, or buying, improving and refinancing.
Can I remortgage a buy-to-let within six months of buying it?
Yes, and on today's value rather than the price you paid. Some lenders allow it without any works, and many more once improvement works are done, subject to underwriting and valuation.
Can I borrow the deposit on a personal loan?
Rarely. Most lenders decline borrowed deposits, and the repayments count against your affordability.