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Buy-to-let | R-Z

Lending criteria – Buy-to-Let

Barclays buy-to-let mortgage is a residential investment product. It's designed for the purchase or remortgage of residential properties (including new build) that will be ready to let on or within 1 month of completion.

Download our packaging requirements for more information or follow the links below.

Packaging checklist

A guide to Buy to Let affordability and online affordability calculator

Buy to Let affordability and the online Affordability Calculator FAQs

Our lending criteria at a glance

Use our A to Z tool below for details of our residential lending criteria

Use our A to Z tool below for details of our buy-to-let lending criteria

  • Reduced income for defined period of time Reduced income for defined period of time

    Where an applicant is currently on, or is to commence, a known period of reduced income, the overall lending assessment and any affordability requirements will be based on the “return to work” income details.

    Considerations:

    • In order to verify “return to work” income, an employer’s letter, addressed to the Bank, should be obtained confirming when the applicant is returning to work, full income details and working hours.
    • Where an employer’s confirmation is not available further documentation should be obtained such as payslips/P60s/HMRC Annual Tax Year Overview together with information regarding length and nature of employment, proposed number of hours to be worked upon return, savings to subsidise commitments/lifestyle whilst on period of leave. Further information may be required in order to fully assess based on individual circumstances.

    Key consideration is to ensure that the required income level can be maintained during any period of leave and continues to be met on a sustainable basis following return to work especially where reduced hours are to apply.

  • Refinancing Business Debt Refinancing Business Debt

    Applications from your client to purchase properties in their own personal name from a Limited Company where they have a financial controlling interest are outside our standard lending criteria.

  • Remortgages (including capital raising) Remortgages (including capital raising)

      Re-mortgages must always be treated as a new lending proposition and assessed and underwritten on the basis of the aggregate borrowing/overall exposure and in accordance with BTL Lending Policy.  

    In ALL cases:

    • Refer to Basic Lending Terms for maximum loan to value, minimum interest cover, maximum individual loan amount, maximum aggregate exposure and LTV/property restrictions per customer
    • The applicant must have owned the property for a minimum of 6 months before a re-mortgage will be considered
    • All lending on New Build Properties, including newly converted properties (first registration of the property was 2 or fewer years ago), MUST be restricted to 75% LTV
    • The applicant must always complete the appropriate application/online submission and detail the purpose of any capital raising required
    • Supporting documents must be provided as detailed in the Requirements Table
    • For SPVs / LLPs care must be taken to ensure that all areas of lending policy relating to SPV/LLP borrowers are met

    Re-mortgages with capital raising:
    Any re-mortgage must meet our minimum mortgage amount of £35,000, subject to product availability. It is acceptable for the capital raising element to be used for the following purposes only:

    • To assist with the purchase of a further residential property (ie, BTL or residential property)
    • To buy out the equity interest from associated parties
    • For property repairs or improvements to any residential property owned
    • To assist with financing changes in our security, eg, purchase of additional land that will form part of our security, purchase of freehold, extension of lease
    • To repay existing residential mortgage

    On joint mortgage applications where there is any additional borrowing or equity release in excess of £50,000 and this is to be for the benefit of one party to the mortgage only (eg purchase of a second/BTL property to be registered in the name of one party), Independent Legal Advice must be obtained by all other borrowers not directly benefiting before any funds are released.

  • Repayment strategies for interest-only BTL mortgages Repayment strategies for interest-only BTL mortgages

    The following repayment strategies are acceptable for interest-only BTL mortgages:

    • Sale of mortgaged property
    • Existing endowment policy
    • Existing stocks and shares (ISA)
    • Existing share, unit or investment trust (professionally managed)
  • Repayment types Repayment types

    BTL loans can be taken on the basis of:

    • Capital repayment (capital & interest)
    • Interest-only or
    • A mixture of both
  • Residency Residency

    Residency criteria for BTL Lending differs to that of residential mortgages as the property won't be occupied by the client. The definitions, for BTL purposes, of a UK resident, a non-UK resident, and expatriate are detailed below:

    UK resident –  UK resident – acceptable for Buy to Let lending purposes

    Someone who has Permanent Rights to Reside in the UK, AND has been resident in UK for 2 years or more.

    Applications that meet this definition can be considered under these standards. 
     
    Non UK resident – not acceptable for the purpose of Buy to Let lending purposes.

    Someone who does not have Permanent Rights to Reside in the UK and is either not resident in the UK at the time the application is submitted, OR is currently resident in the UK but has been for less than 2 years prior to the date of application.

    We currently only accept applications from non-UK residents for existing Barclays BTL mortgage holders through Barclays Wealth International. Please contact them on 0207 114 8804 * for further information. 

    A customer who does not meet the above residency requirements but wants to re-mortgage an existing Barclays residential mortgage to BTL may be considered provided all other lending standards are met.

  • Self-employed Self-employed

    Applicants are regarded as self-employed when they hold more than 20% share in a company. Applicants must have been self-employed for a minimum of 3 years. Refer to the ‘Allowable Gross Income’ section above for details of the allowable income and corresponding documentary evidence required to support the application.

  • Solicitors Solicitors

    We'll accept solicitors to act on behalf of Woolwich if nominated from the Woolwich panel. The Woolwich reserves the right to nominate/appoint solicitors to act on its behalf, the costs of which must be covered by the applicant.

  • Special purpose vehicle (SPV) limited company Special purpose vehicle (SPV) limited company

    Our definition of a Special Purpose Vehicle Limited Company is a UK-incorporated company that has been established by private individual(s) for the sole purpose of BTL activities i.e. the purchase/remortgage of residential properties for letting. This is confirmed by the Standard Industry Classification (SIC) Code registered at Companies House and will be checked/evidenced for our purposes by a full Company Search being carried out by our BTL Mortgage Processing Team.

    The following codes are acceptable under the current SIC 2007:

    68100 – Buying and selling own real estate
    68209 – Other letting and operation of own or leased real estate
    68320 – Management of real estate on a fee or contract basis

    In addition, the following historic codes under SIC 2003 are also acceptable:

    • 7012 - Buying & sell own real estate,
    • 7020 - Letting of own property, or
    • 7032 - Manage real estate

    Please remember that we now only consider applications from SPV Limited Companies which are existing clients ie the SPV Limited Company already has BTL mortgage lending with us. This is subject to the structure of the SPV Limited Company continuing to be acceptable. For more information please contact our Intermediary Support team on 0345 073 3330.

  • Supporting documentation Supporting documentation

    Proof of identity and address verification for all private individuals, directors, shareholders and members must be obtained.

    Proof of address: A minimum of 3 years uninterrupted history must be provided by all mortgage applicants. We'll confirm 2 years address history via the Voters Roll wherever possible for UK residents; if we are unable to do this we'll have to ask for documentary evidence to cover the last two years.

    For full details of our requirements, please contact 0345 073 3330 Monday-Friday, 9am-5pm.

  • Term of mortgage Term of mortgage

    The term of a BTL mortgage can be from 5 to 25 years.

  • Valuation and rental assessment appeal Valuation and rental assessment appeal

    Customers can appeal against Valuations only when there is more than a 25% variance between the customer’s estimated value and the actual valuation provided by the Bank’s nominated valuer. This applies to both Residential and Buy to Let cases.

    If your customer wishes to appeal the valuation in line with the guidance above, they will need to contact Ekins Customer Care at ekins.customercare@barclays.com. Your client will be asked to complete a form and supply three comparable properties sold in the last three months.

    Appeals on rental valuation figures are not accepted.

  • Valuations Valuations

    To be able to lend on a property, Barclays requires a valuation to be carried out. When you apply for a Barclays mortgage, the valuation type depends on whether your mortgage will be on a residential or Buy to Let basis.

    The mortgage valuation is our standard report for all residential applications and includes a description of the property, an opinion of the market value of the property as at the date of inspection, and an estimate of the current cost to reinstate the property in its present form (where appropriate).

    It’s important to remember that the mortgage valuation is a report which is primarily for Barclays’ purposes and confirms whether the property is suitable security for a mortgage – it is not a survey. As such, we ask that all clients consider instructing a separate survey to provide them with a more detailed assessment of the condition of the property.

    Your client may wish to contact Countrywide Surveying Services on 0800 012 6995 *, e.surv on 0800 169 9661 *, or any other provider to discuss the different survey options available. More information on the types of survey available can be seen found on the ‘Home Surveys’ section of the Royal Institution of Chartered Surveyors website.

    Please note that if your clients do instruct their own survey, this will be a separate contract between them and their chosen survey provider with separate fees applying. Barclays will always rely on the mortgage valuation for the purpose of agreeing the mortgage.