How Buy to Let rates are set
Buy to Let mortgage rates are shaped by several key factors:
- The deposit you put down, or the Loan to Value (LTV) ratio is significant. Lower LTVs such as 60% typically attract better rates compared to higher LTVs like 75% or 80%, due to the reduced risk for lenders
- The term length also influences the rate, as 2-year and 5-year fixed products are subject to different affordability stress tests and rental coverage requirements
- Lenders assess applications using specific criteria, including:
- Rental income stress tests
- Minimum personal income thresholds
- Experience as a landlord
- The type of property. They look at whether it is a House in Multiple Occupation (HMO), a Multi-Unit Freehold Block (MUFB), or a standard residential property. The property type can further impact the rate offered and the product options available
Rates shown are indicative only and used for illustrative purposes. Actual rates vary by lender, product, borrower profile and market conditions at the time of application.
| LTV | Term | £2K fee (*) | £1K fee (*) | £0 fee (*) | 5% fee (*) | 2% fee (*) |
|---|
| 60% | 2-year fixed | 4.08% (-0.01%) | 4.29% (+0.02%) | 4.44% (-0.01%) | - | - |
| 60% | 5-year fixed | 4.26% (-0.01%) | 4.35% (+0.01%) | 4.37% (-0.01%) | - | - |
| 75% | 2-year fixed | 4.66% (-0.02%) | 4.75% (+0.01%) | 4.89% (+0.01%) | 4.08% (+0.01%) | 4.99% (+0.01%) |
| 75% | 5-year fixed | 4.79% (-0.01%) | 4.76% (-0.01%) | 4.83% (+0.01%) | 5.03% (+0.01%) | 5.34% (+0.01%) |
* Weekly change
A shift towards refinancing rather than expansion
BTL mortgage pricing during Q2 2026 continued to be driven less by base rate headlines and more by swap rate expectations, lender appetite and rental affordability stress testing. While the Bank of England base rate remained at 3.75% during Q2 2026, many landlords will only feel the benefit of any future cuts indirectly, as fixed-rate pricing responds to expectations of where rates go next rather than where they are today.
UK Finance highlights that refinancing remains a dominant trend in 2026, with around 1.8 million fixed-rate mortgage deals due to end in 2026 and external remortgaging forecast to rise by around 10% year-on-year.
Lenders continue to compete for good-quality business, and product availability has improved across parts of the market. However, landlords still need to meet rental affordability stress tests, so refinancing decisions remain highly dependent on rental cover, equity levels and overall portfolio strength.
The move is designed to make it easier for banks to provide loans to consumers and businesses.
Ollie’s opinion
If you’re a landlord looking at rates right now, the biggest red flag I see is focusing purely on the headline percentage and ignoring whether the deal actually works under lender stress tests. In practice, BTL success or failure is far more often about rental coverage, fees and structure than whether the rate starts with a 4 or a 5.
Yes, competition has improved, and some pricing has become more stable - but this isn’t 2021 and it’s not going to be. The smarter landlords are the ones optimising what they already own, locking in sensible cashflow and stress-testing their own portfolios properly rather than chasing the cheapest deal on a comparison table.
Oliver Peace
BA(Hons) CeMAP DipFA
Managing Director and non-advising Firm Principal
A bit about Oliver…
After gaining his CeMAP qualification, Oliver began his career in financial services in 2007 as a mortgage adviser specialising in remortgages. In 2010, after gaining invaluable experience helping individuals and families, of all walks of life, to improve their financial situations, Oliver found the confidence to launch James Leighton Financial Services. His objective was to build a firm offering a full spectrum of financial services and whilst building a new and loyal client base, he gained his Diploma in Financial Advice, which enabled him to advise on pensions and investments. After building a relationship with a new build developer in 2011, with Oliver at the helm, the firm saw exponential growth from a sole trader to the firm that we see today, with a team of around 50 professionals, national coverage and a reputation as one of the foremost new build specialists in the country. Oliver believes that the success of the firm is down to one of the firm’s core values which is to genuinely about by focussing on improving. By treating each customer as if they are a member of the family has helped build real trust and long-term repeat business.
Oliver’s interests out of work centre around spending time with his daughter, enjoying holidays in the UK and abroad and, when he has time, furthering his passion for sportscars.s out of work centre around spending time with his daughter, enjoying holidays in the UK and abroad and, when he has time, furthering his passion for sportscars.
How BTL rates typically compare to residential mortgages
As a general rule of thumb, Buy to Let mortgage rates are often more expensive than residential mortgage rates.
