Best Buy to Let Remortgage Rates UK: How One Investor Secured Long-Term Gains

Client Overview

A mid-40s property investor based in the South of England recently sought assistance in obtaining a buy-to-let mortgage. The client, employed in a professional services role, aimed to purchase a property from a family member at full market value to generate rental income. With a mixed credit history and specific income requirements, he needed expert guidance to secure the best possible remortgage deal that aligned with his long-term investment goals.

The Main Challenge: Buy-to-Let With Credit Hurdles

The client wanted to:

• Purchase a property from a family member to rent out
• Secure a 5-year fixed interest-only mortgage
• Ensure monthly payments remained below projected rental income

However, the client faced obstacles due to his credit history. Several mainstream lenders declined his applications at the agreement-in-principle stage, restricting access to standard buy-to-let mortgages and competitive interest rates. Additionally, the rental income did not meet the affordability requirements of some high-street lenders.

Tailored Mortgage Solution from a Specialist Lender

After evaluating the client’s financial profile and property purpose, our experts recommended a specialist lender, Foundation Home Loans, known for accommodating applicants with adverse credit histories. The selected product was:

• Loan Amount: £234,665
• Interest Rate: 5.29% fixed for 5 years
• Term: 29 years (interest-only)
• Repayment Method: Sale of property at end of term

This mortgage was chosen because it allowed for interest-only repayments, ensuring that the rental income comfortably covered the monthly instalments. Additionally, the fixed rate provided cost certainty during the critical first years of property management.

Why Foundation Home Loans?

Although initial applications to lenders like Accord Mortgages, Virgin Money, and HSBC were declined, Foundation Home Loans offered a viable alternative. Their flexible lending criteria made them the ideal fit, allowing the client to proceed without delays. While the 5-year fixed product included a product fee of £2,933.31, the client chose to add this to the mortgage—a decision that balanced upfront cost with long-term gains.

Key Features and Benefits of the Mortgage

• Up to 10% annual overpayment facility without penalty
• No valuation fee
• Streamlined application-to-completion turnaround
• Rental income sufficient to self-finance into retirement
• Early repayment charge options explained and accepted

This buy-to-let mortgage not only met immediate affordability goals but also aligned with the client’s retirement income strategy, which is based entirely on rental income from his property portfolio.

“I needed a long-term interest-only mortgage where the rental income would cover the payments, with some flexibility for overpayments. Deal Direct matched me with a lender that understood my situation and made the process stress-free.”

Results Achieved

The client successfully secured financing for the property purchase, locking in a competitive rate despite limited options caused by his credit profile. Key achievements include:

• Fixed monthly payments of £1,047.57 during the initial period
• Confidence of consistent low-cost borrowing on an interest-only plan
• Long-term flexibility to generate income and build equity through property ownership

Frequently Asked Questions

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

Yes, specialist lenders such as Foundation Home Loans can provide buy-to-let products for applicants with poor credit history. They assess affordability and rental income rather than perfect credit scores.

Why choose interest-only for buy-to-let mortgages?

Interest-only reduces monthly payments, increasing profit margins from rental income. However, you must have a repayment strategy at the end of the term (e.g., selling the property).

Will adding fees to the mortgage cost more?

Yes, adding fees increases the total interest paid over time, but for many borrowers, it provides short-term cash flow relief and makes budgeting easier.

Can I make overpayments on a buy-to-let mortgage?

Many lenders, including Foundation Home Loans, allow up to 10% of the loan balance to be overpaid annually without penalty, helping reduce total interest paid.

Does taking a mortgage into retirement affect approval?

If the mortgage is self-financing via rental income, lenders may allow terms extending into retirement. Lenders will assess your ability to service the mortgage based on anticipated retirement income.

Take The Stress Out of Buy-to-Let Mortgage Hunting

Whether you’re struggling with bad credit, complex income, or navigating buy-to-let rules, we can help you access the best buy to let remortgage rates UK-wide. With whole-of-market access and experts who understand landlord financing, you’re always in capable hands.

Contact us today to explore your options and secure the ideal mortgage for your property investment goals.