A Let to Buy arrangement is a structured mortgage solution designed for homeowners who wish to retain their current property while purchasing a new residential home https://smartcitymortgages.co.uk/blog/let-to-buy-mortgage-guide-how-it-works-criteria-costs-and-risks-2026/ . It typically involves converting an existing residential mortgage into a rental-based agreement while simultaneously securing a new mortgage for onward purchase. This approach is subject to lender assessment, regulatory requirements, and financial risk considerations. What is a Let to Buy mortgage? It is a dual-transaction process where the borrower keeps ownership of their current home and rents it out, while taking out a separate residential mortgage on a new property. The original property becomes an income-generating asset, and the borrower effectively takes on two financial commitments. How does a Let to Buy mortgage work? In practice, the borrower refinances the existing home onto a rental mortgage product, often based on projected rental income rather than personal income alone. At the same time, they apply for a standard residential mortgage for the new home. The equity released from the original property may be used as a deposit toward the new purchase, depending on lender policies and valuation outcomes. Who is Let to Buy suitable for? This option may be considered by individuals relocating for work, upsizing, or those seeking to retain long-term investment exposure to property. It may also appeal to borrowers who expect capital appreciation on their existing home but need to move without selling immediately. Suitability depends on financial stability, equity position, and the ability to manage multiple obligations. Let to Buy vs Buy to Let: what’s the difference? A Let to Buy arrangement involves converting a current residence into a rental while purchasing another home to live in. In contrast, a Buy to Let mortgage is used specifically to purchase an investment property without the borrower residing in it. The underwriting approach, stress testing, and affordability calculations may differ between the two. What are the lending criteria for Let to Buy mortgages? Lenders typically require a strong credit profile, sufficient income to support the new residential mortgage, and adequate equity in the existing property. Some providers impose minimum income thresholds and may limit total borrowing exposure across both properties.