Buy to Let Mortgages from 15% Deposit
If you’re thinking about becoming a landlord or growing your property portfolio, the size of the deposit needed for a buy to let mortgage is likely high on your list of concerns.
While many lenders require a substantial deposit, there are still opportunities to access buy to let mortgages with lower upfront costs.
Whether you’re a first-time investor or looking to expand your holdings, understanding your options can help you take the next step confidently.
What Is Considered a Low Deposit for Buy to Let?
Traditionally, buy to let mortgages come with a minimum deposit requirement of around 25 percent of the property’s value. This means if you’re buying a property worth £200,000, you’d need at least £50,000 as a deposit.
However, a low deposit in this context usually refers to anything below that standard 25 percent mark. In some circumstances, it’s possible to secure a buy to let mortgage with as little as 15 to 20 percent deposit. That said, these deals tend to come with higher interest rates and tighter eligibility criteria. Some specialist lenders may consider even lower deposits if you’re leveraging other assets.
Can You Get a Buy to Let Mortgage with No Deposit?
While rare, there are cases where you could technically invest in a rental property without putting down a traditional cash deposit. This would typically involve remortgaging another property you own and using the equity as security. It’s important to understand that this approach still carries risk and is usually only suitable for experienced landlords with significant equity to release.
It may also be possible to do this as a ‘concessionary purchase’ if you have a family member that is selling you a property to use as a buy to let, using the gifted equity as a deposit.
Find out Your Options
Who Offers the Lowest Deposit Buy to Let Mortgages?
Most high street lenders ask for 25 percent or more. However, a few specialist lenders do consider lower deposits. If you’re buying a house (rather than a flat or new build), you may find more options at the 20 percent deposit level.
The list of potential lenders for these changes all the time, so it’s always best to speak with a broker like Kerr & Watson. We have access to a wide panel of lenders, including those you won’t find on the high street.
What Affects Your Eligibility?
Even if you find a lender willing to accept a lower deposit, there are several factors that could influence your chances of approval:
Rental income projections
The expected rental income must meet a minimum threshold to cover the mortgage payments, often at least 125 percent of the interest charges, and sometimes more. If your anticipated rent doesn’t meet the lender’s stress test, your application might be declined or require a higher deposit.
Your personal income
Some lenders use a method called “top slicing,” where they consider your surplus income to make up for any rental shortfall. This can help if the rent doesn’t fully cover the mortgage on its own.
Credit history
If you have missed payments, defaults, or a poor credit score, lenders may require a larger deposit to mitigate the risk. That doesn’t mean you won’t get a mortgage, but you might need a specialist lender who caters to complex circumstances.
Property type
Some lenders restrict low deposit options to standard freehold houses. Flats, maisonettes, and new builds often come with stricter rules and may require deposits of 25 percent or more.
Landlord experience
First-time landlords can still access the market with some lenders, but they may need to provide a larger deposit. Some lenders only work with applicants who have an existing buy to let experience, so always worth taking advice.
Pros of a Low Deposit Buy to Let Mortgage
Choosing a low deposit buy to let mortgage can help you get on the property investment ladder faster, but it’s always the best solution. Here are a few potential advantages:
- Lower upfront costs: You’ll need less cash to get started, which may be helpful if you’re tying up capital elsewhere.
- Faster portfolio growth: With lower deposits, you could invest in more than one property sooner than expected.
- Higher potential ROI: If the property grows in value, your return on investment can be greater as you’ve put in less capital.
This can make property investment more accessible, especially if you’re keen to act while prices are favourable or if you’re new to letting.
Cons of a Low Deposit Buy to Let Mortgage
While the benefits can be appealing, it’s important to be aware of the trade-offs:
- Higher interest rates: Lenders will usually charge a premium for higher risk loans. Over time, this can reduce your profits.
- Limited choice of deals: Fewer lenders offer high loan to value products, which can limit your flexibility.
- Stricter lending criteria: You may be required to meet more demanding affordability or credit checks.
- Higher monthly repayments: With a larger loan amount and higher rate, your monthly mortgage costs will likely be more expensive.
- Greater risk of negative equity: With a small deposit, you’re more exposed if property values fall.
If you’re unsure whether the trade-offs are worth it, a broker can help you weigh up the pros and cons.
How Kerr & Watson Can Help
Whether you’re an experienced landlord or looking to buy your very first rental property, we’ll guide you through the process, assess your eligibility, and recommend lenders who offer the most competitive low deposit options.
We don’t just look at the numbers. We consider your long-term plans, income, and risk tolerance to help you make a confident, well-informed decision.
If you’re struggling to raise a 25 percent deposit or unsure whether to use equity from another property, our team is here to explore every available route with you. With access to specialist lenders and years of experience handling complex applications, we’re ready to help you secure the most suitable deal.
Conclusion
Getting a buy to let mortgage with the lowest deposit isn’t always straightforward, but it can be possible with the right guidance and preparation, for some borrowers. While a 25 percent deposit is the standard, some lenders will consider 15 to 20 percent, and in some cases, you might not need to put down cash at all if you have other assets to leverage or it’s a concessionary purchase.
Just remember, a smaller deposit usually comes with strings attached. From higher interest rates to stricter lending criteria, you’ll want to be sure it’s the right move for your investment strategy.
At Kerr & Watson, we’re here to help you understand your options, calculate the true cost of your investment, and make sure you’re not paying more than you need to. If you’re ready to explore buy to let mortgage options, contact us today for tailored advice and support from our experienced team.
