Buy to Let Mortgages - Deposit
If you were to approach a bank on a ‘commericial’ basis to buy rental property then they most certainly would be looking for a deposit from you of at least 25% and more likely 30%. So if the property was valued at £100,000 then they would require you to fund £30,000 and would lend you £70,000. This is a pre-historic attitude and because of this, the specialist buy to let mortgage market was born and lenders would only ask for 20% deposit.
The market has moved on now even further and it is now commonplace for the required deposit to be only 15%. There are even now lenders that will accept only 11% deposit however the achievable rental yield tends to drive the amount of deposit required and in essence whether a property is a viable proposition or not to the investor.
Realistically, the more deposit that you are able to put down then the better rate that will be available to you.
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