If you own a home on a residential mortgage and want to rent it out, switching to buy-to-let is possible. Lenders treat this differently to a standard remortgage, and there are two routes to consider depending on your circumstances.
The Two Routes: Consent to Let or a Buy-to-Let Remortgage
You have two options if you want to let out a property that currently has a residential mortgage on it:
- Ask your existing lender for consent to let, or
- Remortgage onto a dedicated buy-to-let product, potentially with a new lender
Which one suits you depends largely on how long you plan to rent the property out and why you’re doing it in the first place.
Common reasons people want to let out their home include:
- Moving in with a partner
- Relocating for work
- Travelling for an extended period
- Being away from the property for a significant length of time
- Wanting to buy a new home while keeping the current one
Neither route works quite like an ordinary residential remortgage:
- With consent to let, you don’t remortgage at all – you stay on your current deal with your current lender, though they may add new terms
- Buy-to-let mortgages are assessed differently to residential ones. Affordability is based on the expected rental income the property could generate, not your personal salary
Below, we cover how consent to let works, when a full buy-to-let remortgage makes more sense, and how lenders assess affordability for each.
What Is Consent to Let and Do I Need It?
Consent to let is permission from your existing lender to rent out your home, typically granted for 6 to 12 months at a time. It’s different from a buy-to-let mortgage, where the intention to let is declared upfront as part of the application.
Consent to let tends to be the right route if you plan to move back into the property eventually, rather than let it indefinitely – for example, if you’re temporarily relocated for work, caring for a relative, travelling, or coming to the end of your current mortgage term.
You need your lender’s permission before renting out a residential property because residential mortgages are regulated by the FCA (Financial Conduct Authority), while buy-to-let mortgages are not. Letting the property without consent risks breaching your mortgage terms. It’s also worth knowing that while you must ask for consent, your lender is under no obligation to grant it.
How Hard Is It to Get Consent to Let?
This varies by lender and by your personal situation. Lenders generally want reassurance that your reasons for letting are genuine and that the arrangement will remain affordable. Consent to let may be refused if:
- The length of time you want to let for is too long
- The expected rental income is too low
- The lender suspects your intention to let was there from the start, and that you took out a residential mortgage to get better terms
- You have a history of missed payments or arrears
If consent is refused, your remaining option is a buy-to-let remortgage, covered below. Where consent is granted, lenders usually don’t restrict who you let to, but they will typically expect a standard tenancy agreement, such as an assured shorthold tenancy, usually for a 6 or 12 month term.
Your best first step is simply asking your current lender whether consent to let is something they offer for your circumstances.
Does Consent to Let Cost Anything?
Most lenders charge an admin fee, often around £75, which is generally far cheaper than remortgaging onto a buy-to-let product. That said, some lenders raise your interest rate for the duration of the letting arrangement, which can increase your monthly payments even without a full remortgage.
Switching Fully to a Buy-to-Let Mortgage
If consent to let isn’t granted, or doesn’t fit your plans, the alternative is remortgaging onto a buy-to-let product, potentially with a different lender entirely.
One key difference: most residential mortgages are repayment based, while most buy-to-let mortgages are interest-only. On an interest-only deal you only pay the interest each month, keeping payments lower and preserving rental profit, but the full loan balance is still owed at the end of the term – usually repaid by selling the property, refinancing, or using savings. Repayment buy-to-let mortgages exist but are less common, since the higher monthly cost eats into rental yield. Most landlords prefer interest-only for this reason.
Affordability Criteria for a Buy-to-Let Mortgage
When you apply, lenders assess you much as they would a new buy-to-let purchase. Rental income covering the mortgage is the main focus, but they’ll also weigh up your broader financial position, including:
- Your credit history, with no recent defaults or missed payments
- Whether projected rent meets the lender’s required rental coverage ratio, typically 125 to 145 percent of the mortgage payment
- Your personal income, particularly if rental income alone doesn’t meet the affordability bar
- The deposit or equity you hold in the property
- Any previous experience as a landlord, which some lenders prefer or require
- The type and condition of the property being let
How Much Equity Do You Need?
Most buy-to-let lenders cap borrowing at 75 percent loan-to-value, meaning you’ll need at least 25 percent equity in the property. If you fall short, you may need to top it up with a cash contribution. A small number of lenders offer higher LTVs, but these tend to come with tighter criteria or higher rates.
How Much Rent Will You Need?
Most lenders require rental income to cover at least 125 percent of the monthly interest-only payment, calculated using a stress-tested rate of around 5 percent. Speak to a broker or use a buy-to-let calculator to work out the minimum rent needed for your borrowing amount, since the lender will also want to know how much you intend to borrow before confirming what you’ll need.
How Long Does the Switch Take?
Timelines vary depending on whether you’re applying for consent to let or remortgaging in full. Consent to let with your existing lender can sometimes be approved in under two weeks. Remortgaging to a buy-to-let product, especially with a new lender, generally takes longer – often 4 to 6 weeks – since it involves a full application, valuation, and legal checks. If you have tenants lined up or a deadline in mind, it’s worth starting the process early.
What Does It Cost to Switch to Buy-to-Let?
Several costs can apply when remortgaging from residential to buy-to-let:
Arrangement fee – most lenders charge a product fee for the new mortgage, ranging from a few hundred to several thousand pounds. Some let you add this to the loan, though you’ll then pay interest on it.
Early repayment charges (ERCs) – if you remortgage away from your current lender while still inside a fixed or discounted period, you may face an ERC, often calculated as a percentage of your outstanding balance. Check your current mortgage terms to see if this applies.
Valuation fee – lenders usually need to value the property for its rental potential and market value. Some offer this free; others charge between £200 and £1,000 depending on the property.
Legal fees – a solicitor or conveyancer will need to update the mortgage deed. Some lenders cover this as part of the deal; otherwise you’ll need to pay for it yourself.
Higher interest rates – buy-to-let rates tend to run higher than residential ones, and since most are interest-only, you’ll also need a plan in place to repay the capital at the end of the term.
Will You Pay Stamp Duty?
Generally, no – Stamp Duty Land Tax applies to property purchases, not to refinancing or changing the terms of an existing loan. There are exceptions, though:
Buying a new main residence while keeping the old one – if you buy a new home to live in and keep your current property to let out, the new purchase counts as a second property, triggering the second property surcharge. This is an additional 3 percent on top of standard rates up to 31 March 2024, rising to 5 percent from 1 April 2025.
Changing ownership or adding a name – transferring the property to a partner, spouse, or anyone else when switching to buy-to-let could trigger Stamp Duty, particularly where the transfer shifts a larger share of value above the relevant threshold.
Buying out a co-owner – if you buy out someone else’s share while remortgaging to buy-to-let, Stamp Duty may be due on the share you acquire, again if it exceeds the threshold.
Transferring to a limited company – HMRC treats this as the company buying the property from you, so Stamp Duty is usually due. If you own or control the company, HMRC may use the full market value to calculate the amount owed, even if the property is transferred for less, and the purchase will typically attract the higher additional-property rates.
Can You Move from Consent to Let onto a Buy-to-Let Mortgage Later?
Yes. Many people start with consent to let as a short-term measure, then move to a dedicated buy-to-let mortgage if they end up letting for longer than planned.
Consent to let is usually only granted for 6 to 12 months at a time. Some lenders will extend it, often at a higher rate or with added fees, but if you want to keep letting beyond the agreed period, you may need to switch to a buy-to-let mortgage.
If your current lender offers buy-to-let products, an internal switch can be quicker and cheaper than remortgaging elsewhere, since it may avoid some legal costs. You’ll still need to meet their buy-to-let criteria around rental income, deposit or equity, and overall affordability. If your lender doesn’t offer a competitive buy-to-let option, remortgaging to a different lender is the alternative.
A mortgage broker can help you weigh up whether switching makes sense for your situation and find suitable deals.
What Happens If You Rent Out Your Home Without Switching?
If you let your property without consent to let or a buy-to-let mortgage in place, you’ll be in breach of your mortgage agreement, which can carry serious consequences from your lender.
Can You Let Your Current Home and Buy a New One?
Yes – this is a common approach. Many homeowners release equity from their current property when switching to buy-to-let, then use that money as a deposit on a new home. You’d end up with a residential mortgage on the new property and a buy-to-let mortgage on the old one. This arrangement is known as let-to-buy.
Key Steps When Switching to Buy-to-Let
- Speak to your lender first – let them know you intend to convert your residential mortgage to a buy-to-let arrangement so they can talk you through their process
- Expect an assessment – your lender will look at your finances, the property’s rental potential, and their own buy-to-let lending criteria
- Budget for different rates and fees – buy-to-let products often come with different costs to residential ones, and your lender should set out how this affects you
- Switch your insurance – you’ll need landlord insurance in place of residential cover, which typically protects against tenant-related risks
- Think about tax – rental income is generally taxable, so factor this into your planning
- Check local rules – make sure you understand the legal requirements around renting out a property in your area
- Confirm affordability – lenders have specific affordability rules for buy-to-let, so check you can comfortably meet the payments before switching
Working closely with a broker or your lender throughout this process will help you understand exactly what’s involved, since policies and procedures differ between lenders.