An interest only buy to let mortgage can be a popular option for landlords who want to maximise cash flow and manage monthly costs on their investment properties. By paying only the interest each month, many investors use this type of mortgage to improve rental yield and support long-term property strategies.
At Empire Mortgages, we provide expert, whole-of-market advice to help landlords and property investors understand how interest only buy to let mortgages work — and whether this approach is right for their goals.
An interest only buy to let mortgage means your monthly payments cover only the interest charged on the loan, not the capital itself. The original loan amount remains the same throughout the mortgage term and must be repaid at the end, usually through an agreed exit strategy.
This differs from a repayment buy to let mortgage, where each monthly payment reduces both the interest and the outstanding loan balance. Interest-only borrowing is commonly used by landlords who prioritise lower monthly payments and flexibility over paying down capital during the term.
Because the capital is not repaid monthly, it’s essential to understand how and when the loan will eventually be cleared. Empire Mortgages ensures this is clearly discussed before you proceed.
Many landlords opt for interest-only borrowing as part of a wider investment strategy. Common reasons include:
An interest only buy to let mortgage is particularly popular with experienced landlords and portfolio investors who are focused on long-term capital growth rather than short-term repayment.
While interest-only borrowing can be beneficial, it isn’t suitable for everyone. Lenders expect landlords to understand the risks and have a realistic plan in place to repay the capital at the end of the mortgage term.
An interest only buy to let mortgage may be suitable if you:
It may be less suitable if you rely solely on the property value increasing or if you don’t have a clear plan for repaying the loan. Our advisers will talk this through with you in detail to ensure your decision is informed and responsible.
Lenders apply specific criteria to interest only buy to let mortgages. Key factors include:
Loan-to-value (LTV) – typically capped at 65%–75%
Deposit size – usually a minimum of 25%
Rental income – assessed using an Interest Coverage Ratio (ICR)
Interest rate stress testing – lenders assess affordability at higher rates
Credit profile – clean or manageable credit history is usually required
Rental income must normally exceed the mortgage payment by a set percentage, ensuring the property is financially viable. Empire Mortgages will calculate this for you and explain exactly how lender stress tests apply.
One of the most important parts of an interest only buy to let mortgage is having a clear exit strategy. Lenders will often ask how you plan to repay the capital at the end of the term.
Common exit strategies include:
Empire Mortgages will help you think through your exit strategy and ensure it aligns with your wider investment plans.
At Empire Mortgages, we understand that interest-only buy to let mortgages require careful planning. Our role is to make sure you fully understand the benefits, risks, and long-term implications before proceeding.
When you work with us, you benefit from:
We work for you — not the lender — ensuring our advice is always in your best interests.
Our structured process keeps things clear and efficient:
Initial Consultation – We discuss your investment goals, property details, rental income, and long-term plans.
Rental Assessment – We calculate rental coverage and confirm borrowing potential.
Whole-of-Market Search – We compare interest only buy to let mortgage options across a wide range of lenders.
Application & Documentation – We prepare and submit the application and manage all lender requirements.
Valuation & Underwriting – The lender values the property and completes underwriting checks.
Mortgage Offer & Completion – Once approved, the mortgage completes and your investment moves forward.
Choosing between interest-only and repayment depends on your priorities.
An interest only buy to let mortgage may suit landlords focused on cash flow and portfolio growth, while repayment mortgages are often preferred by those wanting to reduce debt over time. There is no one-size-fits-all solution — the right choice depends on your experience, risk tolerance, and long-term plans.
Empire Mortgages will help you compare both options clearly so you can make the right decision.
Whether you’re an experienced landlord or planning your next investment move, Empire Mortgages can help you decide if an interest only buy to let mortgage is right for you — and guide you through the process with confidence.
Book Your Free Buy to Let Consultation with Empire Mortgages Today
Yes. Many buy to let mortgages are available on an interest-only basis, subject to lender criteria and rental affordability.
You must repay the full loan amount, usually through selling, refinancing, or another agreed exit strategy.
It can be, if you don’t have a clear plan to repay the capital. That’s why expert advice is essential.
Most lenders require at least a 25% deposit.
Some lenders may allow it, but criteria are usually stricter. We can advise on suitability.
Recommend a friend who is new to Empire Mortgages and if they then take out their mortgage with us, you’ll each receive £50 worth of vouchers.
The guidance provided within this website is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.
Empire Mortgages Ltd is an Appointed Representative of PRIMIS Mortgage Network, a trading name of TenetLime Ltd. TenetLime Ltd is authorised and regulated by the Financial Conduct Authority. Tenet Lime Ltd is entered on the Financial Services Register (www.fca.org.uk/register) under reference 150643.
Empire Mortgages Ltd may charge a fee for mortgage advice. The amount of the fee will depend on your circumstances and will be discussed and agreed with you at the earliest opportunity. Our typical fee is £295 payable on receipt of a full mortgage offer.
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