A Buy to Let mortgages exists purely for the purpose of buying properties that are intended to be used as a residential rental property. Although the acceptance criteria is more difficult to satisfy than for a Standard Residential Mortgage application, it’s perfectly possible for Self-Employed applicants to obtain a Buy to Let mortgage, provided they take professional advice, approach the right type of lender and do some financial preparation.

Repayments on your mortgage will usually be Interest-only, which means you should take the final loan payment into consideration, as this will be due in full at the end of the mortgage term. Interest rates and arrangement fees are also higher than Standard Residential mortgages, although in recent years the competition has increased, due to an increase in popularity in this investment type.

It’s important to note that, once a Buy to Let mortgage is in place on a property, you will no longer be legally allowed to reside in the property yourself. This mortgage type is also not regulated by the Financial Conduct Authority, except in the specific circumstances that you have bought the property to rent only to close family members.

One of the most notable differences is how Mortgage Lenders determine how much you can borrow. The loan is based on the potential rental yield (income) from your chosen property, rather than your personal income, although it’s possible that you’ll still need to undergo a financial stress test to ensure that you can afford the repayments whilst the property is vacant.