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Buy-to-Let Portfolio Mortgages in the UK

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Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: May 17, 2022

There are over 2.5 million landlords in the UK and successful investors have been able to establish a buy-to-let (BTL) portfolio of a number of properties. In this article, we look at how portfolio mortgages work, what the rules are for owning multiple properties, and how you can find lenders offering buy-to-let mortgages for multiple properties.

What is a buy-to-let portfolio mortgage and how do they work?

A buy-to-let portfolio mortgage is a product designed for buy-to-let landlords with multiple investment properties. It allows them to take out a single mortgage to cover all of their properties, rather than have multiple mortgages to service. You can use a portfolio mortgage to hold all your buy-to-let mortgages under one umbrella. It’s treated as one account, so instead of having separate mortgage providers for each property, the whole portfolio is managed by one lender with a single monthly payment and one statement.

The portfolio is registered as a limited company and all costs and finances are treated as they would be with any other business. From a lender’s point of view, a landlord would need a minimum of four properties to be eligible for a portfolio mortgage.

What are the rules for owning multiple buy-to-let properties?

There is no strict limit to the number of buy-to-let properties you can have in a portfolio, although it will need to be at least four to be classed as one. You might also find that some mortgage lenders will have their own internal cap on the number of properties you can own, or the total amount that you can borrow across your portfolio. This is often determined on a case-by-case basis.

Most mortgage lenders that offer buy-to-let mortgages are regulated by the Bank of England’s Prudential Regulation Authority (PRA). In September 2016, the PRA issued a number of rules to introduce new underwriting standards for these lenders, including stricter affordability tests and extra checks on portfolio landlord mortgages.

Because mortgage lenders will require more documentation from you, this could mean more time-consuming applications and slower decision-making. However, you can help speed up the process by working with a mortgage broker who specialises in portfolio agreements and preparing your documentation prior to your application.

Did you know… You only have access to one third of the Buy-To-Let mortgages available unless you use a specialist broker! Get Started with an OMA-Expert to unlock the entire market.

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What is classed as a ‘portfolio landlord’?

If you have four or more mortgaged properties, you’re classed as a portfolio landlord.

You’re not a portfolio landlord if:

  • You own three investment properties
  • You own five investment properties but only three are mortgaged

If you do have four or more buy-to-let properties with a mortgage, you’ll be subject to the new portfolio mortgage underwriting checks. These are sometimes known as portfolio mortgage stress testing.

As part of these checks, lenders will need to make sure that you’re in a stable financial position. Different lenders have interpreted the rules in different ways, but they will all look at your entire buy-to-let portfolio and are likely to consider:

  • Your experience as a landlord
  • Details of your mortgages on all of your buy-to-let properties
  • Your assets and liabilities, including tax liability
  • Historic and future expected cash flow from your portfolio
  • Your income both from the property and other sources

As different lenders have interpreted the rules in different ways, criteria can vary. This means that if, for example, you have five properties generating enough rent to cover the mortgage payments, but one property that isn’t, your new mortgage application might be declined by one portfolio mortgage company but could be approved by another.

Therefore, if you’re looking for a portfolio landlord mortgage, it’s important to seek professional advice. The advisors we work with are all whole-of-market experts who can look at your portfolio and identify the best option for your circumstances.

How many buy-to-let mortgages can you have?

As long as you meet the criteria, there’s no strict limit to the maximum number of buy-to-let mortgages you can have. Different lenders may have their own rules about the maximum number of loans they can advance to an individual, but there are many portfolio mortgage lenders in the market that want to help you to grow your investment.

If you’re looking to grow your buy-to-let investment portfolio, it’s important to get your paperwork in order and keep an up-to-date spreadsheet of your property portfolio, so that you have all the information readily available when you speak to an advisor.

Tax rules

In addition to the extra 3% Stamp Duty Land Tax that homeowners need to pay if they are buying an investment property or second home, recent changes to tax relief make running a buy-to-let investment more expensive, and these additional costs are an important part of assessing any landlord’s buy-to-let portfolio.

The tax relief on buy-to-let mortgage interest was completely removed on April 6th 2020, so you can’t deduct any of your mortgage expenses from your rental income. This increases the tax bill for investors with a portfolio of mortgage loans. However, this change only affects private landlords.

If you’re looking at growing your number of buy-to-let portfolio mortgages it’s a good idea to seek the advice of a property tax specialist.

Limited company portfolio mortgages

In some circumstances, it can be beneficial for tax reasons for buy-to-let investors to finance multiple buy-to-let mortgages using a limited company.

There are two types of limited company: a trading company, or a special purpose vehicle (SPV).

The most common way for buy-to-let investors to buy with a limited company is with an SPV. There are many more lenders in this part of the market than there used to be and there are plenty of lending options for both.

Therefore, buy-to-let mortgages for limited companies are now often available at similar rates for individuals looking for multiple buy-to-let mortgages.

Buy-to-let mortgage lenders for limited companies will often apply a lower minimum rental stress test than they do for individuals who are higher rate taxpayers, because of the tax advantages associated with buying and managing through a limited company.

How many BTL mortgages can I get using a limited company?

There are no limits to the number of buy-to-let mortgages you can hold within a limited company. However, the same rules will apply when a lender is assessing your entire portfolio as part of the application, and some lenders have a limit on the exposure they are willing to take for one company and can restrict the total number of mortgages or properties.

Remortgaging to expand your buy-to-let portfolio

It’s possible to remortgage a property you own to grow your buy-to-let portfolio, and the first thing to think about here is how much equity you currently have in that property. The level of equity you have is equal to the value of your property minus the balance of the existing mortgage.

Lenders express the amount of a property on which they are willing to lend as loan-to-value (LTV). This is the balance of the mortgage that is secured on the property, as a percentage of the value.

If you’re remortgaging your main residential property to raise money for a buy-to-let mortgage, depending on your circumstances, some lenders will be able to lend up to 95% loan-to-value.

For example, if your home is currently worth £500,000 and you have a mortgage of £250,000, your current loan-to-value is 50% and you have £250,000 of equity in your property. If you wanted to release this equity to buy another property, you could potentially borrow up to £475,000, which would provide you with £225,000 for the purchase and take your LTV to 95%.

Mortgage lenders are generally more comfortable with lower loan-to-value mortgages so you’ll have fewer options, and can expect to pay a higher interest rate, if you want a mortgage with a higher LTV.

The maximum loan-to-value you could borrow also depends on your circumstances, such as your age and credit history, and the purpose for the loan. Whereas the maximum LTV on a standard residential mortgage is 95%, the maximum LTV for a buy-to-let mortgage is usually 85%.

Which lenders offer buy-to-let portfolio mortgages?

Portfolio mortgages are offered by a variety of lenders, and each one has its own criteria that must be met by the applicant. A select number of high street mortgage lenders can also consider portfolio mortgage applications, and you can find a breakdown of their lending criteria in the table below…

Mortgage Lender Lending criteria for portfolio mortgage
Natwest Must have at least four mortgaged or unencumbered properties. Excludes properties held in a limited company. Information required in relation to landlord’s experience, use of letting agents and future plans to expand or reduce their portfolio.
Santander Don’t accept portfolio landlords unless the applicant is remortgaging without capital raising and meets their eligibility criteria for transitional arrangements.
Virgin Applicants must have at least 24 months’ experience in letting property at time of application. No more than five properties in the same postcode region are permitted. Personal income is not accepted to cover any shortfalls, though income is verification needed.
Barclays Consider the client’s personal and rental income as well as ongoing credit commitments. Underwriters will assess the speed of portfolio build and capital appreciation, tenant quality and occupancy levels, use of letting/management agents, portfolio strategy and future funding requirements.

Information correct at time of writing. For up-to-date lending criteria, speak with a broker.

Some mortgage lenders will set a limit on the number of properties you can own in a portfolio as a private landlord. For example, Mansfield Building Society will only accept applicants with 15 or fewer properties.

Others will restrict the types of properties – Nottingham Building Society, for example, does not lend on buy-to-let flats or single title multi-unit properties, plus houses of multiple occupation (HMOs) cannot make up more than 25% of an applicant’s portfolio.

Did you know… You only have access to one third of the Buy-To-Let mortgages available unless you use a specialist broker! Get Started with an OMA-Expert to unlock the entire market.

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How do you know which lender will offer the best rates?

Speak to a broker. If you approach one of these portfolio mortgage lenders directly, there’s no guarantee you’d end up with the best rates. You’d only have access to their products and would be risking missing out on a better deal that might be available elsewhere.

But if you apply through a mortgage broker who specialises in portfolio deals, you would have access to every product that you qualify for, and your advisor will work tirelessly to help you secure the finance you need.

How is affordability calculated for portfolio mortgages?

Buy-to-let affordability models are based on a combination of the rental income the property can achieve and your circumstances. For buy-to-let portfolio lending, a mortgage lender will look at your whole portfolio to make sure you’re not over-stretching yourself when it comes to borrowing.

A lender may also look at your other assets, liabilities and income. However, there are also portfolio mortgage lenders that do not require a minimum income outside of your buy-to-let investment. These are sometimes known as buy-to-let mortgages for professional landlords.

For many lenders, if you are a basic rate taxpayer or buying with a limited company, the rental income has to cover at least 125% of the mortgage, assuming the mortgage is charged at 5.5%. For higher rate taxpayers, this increases to 145% or 160%.

Here’s an example of how your tax bracket affects monthly rental income:

Tax rate BTL mortgage balance Interest stress rate Monthly interest payments Monthly rental income
125% (basic rate taxpayer) £150,000 5.5% £687 £860
145% higher rate taxpayer) £150,000 5.5% £687 £996
160% (top rate taxpayer) £150,000 5.5% £687 £1,100

The above is for demonstration purposes only. For a more accurate figure, speak with a broker.

“Top-slicing” with personal income can help you borrow more

If your rental income isn’t sufficient, then the maximum loan available will reduce to fit the calculation. Some mortgage lenders allow you to supplement the achievable rental income with your personal income. This is sometimes known as ‘top slicing’, which is when a landlord uses other earned personal income to top up shortfalls in buy-to-let affordability.

Do I need insurance for my property portfolio?

While it’s not a legal requirement, portfolio insurance could potentially save you time and money.

With portfolio insurance, you can arrange buildings and contents cover across a number of properties, so you don’t have to spend a lot of time getting individual quotes and policies for each address. This can often be more convenient and more economical.

We work with specialist insurance experts who will be able to talk you through the best options for your circumstances and, because they’re independent, they’ll work to find you the most competitively priced cover for you too.

Speak to an expert about buy-to-let portfolio mortgages

If you’re looking to start up a buy-to-let mortgage portfolio or have ambitions to expand an existing one, the right advice is crucial and can be the difference between getting the best deal on the market and paying over the odds in interest. We work with mortgage brokers who specialise in BTL portfolio mortgages, and they have a track record of helping landlords secure the finance they need, often when the odds of mortgage approval was stacked against these customers.

If you use our free broker-matching service, you can rest assured that you’ll be paired with the right advisor for your needs and circumstances. This will be a buy-to-let expert we’ve fully vetted, so we can personally guarantee they have the knowledge and experience to help you out.

Call 0808 189 2301 or make an enquiry online and we’ll arrange a free, no-obligation chat between you and a specialist buy-to-let portfolio mortgages broker today.


Can I get a buy-to-let portfolio with bad credit?

Bad credit doesn’t have to prevent you from becoming a buy-to-let mortgage portfolio landlord, depending on the type of credit problems you have had and how recently you have had them.

A mortgage lender will ask what the issue was, how long ago it was, how much it was for, and whether it has been repaid. Some lenders will also ask for an explanation about previous credit problems to help them to understand whether these were one-off events or are likely to happen again. The take-home point is that it is potentially possible to get a buy-to-let portfolio mortgage with bad credit, although this might mean having to use a specialist lender.

See our guide to bad credit buy-to-let mortgages for more information.

What property types can I get?

Buy-to-let portfolio mortgage products are available on most standard construction terraced/semi/detached houses and purpose-built flats.

Options may be more limited for investors who want to purchase a studio flat, ex-council property or a property of non-standard construction (e.g. buildings made from unusual materials such as concrete or timber). This is another area where it is important that you choose a lender that is able to lend on your property, and this sometimes means using a specialist mortgage provider.

What are the age restrictions around portfolio mortgages?

The minimum age for most lenders is 18. For older borrowers who are considering multiple buy-to-let mortgages, lenders may stipulate a maximum age at application or a maximum age at the end of the mortgage term, but there are many buy-to-let lenders that do not have a maximum age.

Can I set up a buy-to-let property portfolio in Scotland?

Yes, and Scottish mortgage portfolios are becoming increasingly popular, as more and more people are heading north to take advantage of the price gap between English and Scottish cities.

According to Hometrack, the average price (September 2019) in Edinburgh was £236,900, compared to London’s £483,000. Glasgow fares even better with an average price of just £124,800, so you could potentially own four buy-to-lets for the price of one in London.

This makes Scotland an attractive proposition for BTL, but bear in mind that Scotland has different laws regarding the purchase of properties, such as the requirement that you have to register your property with the local council before you can rent it out.

Ask us a question

We know everyone's circumstances are different, that's why we work with mortgage brokers who are experts in Buy-To-Let mortgages.

Ask us a question and we'll get the best expert to help.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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