We hear you

Your guide to investing in Buy to Let

This guide includes a summary of our lending conditions for your guidance only. Please note that the conditions listed in this guide are for guidance only. See our full Buy to Let lending criteria to ensure that you qualify.

• Step 1: Research
• Step 2: Rules of Application
• Step 3: How much can I borrow
• Step 4: Repayment methods
• Step 5: Property criteria
• Step 6: Protecting your investment
• Step 7: Ensure you prepare for an empty property

Step 1 : Research

Buying a property to let can be a great investment or business venture, but it is very different to buying a property that you will live in yourself. Research is the key to ensure that you're not just buying a property that you would like - but that has real investment and rental potential.

You must get to know the market in the area you're considering; how much you can expect to gain from rental income, what's the competition like and which areas are up and coming. You also need to remember that you won't be living in this property yourself, so try to take an objective viewpoint and consider the type of things that any prospective tenant will be looking for:

• Are the rooms a decent size? Are they even sizes?
• Are there good transport links nearby?
• Is the property in a good position for shops and amenities?

Step 2 : Rules of application

We offer a range of different Buy to Let mortgages to suit different circumstances and help you gain the most from your investment. To qualify you must:

• be 21 or over
• have had a mortgage for at least 12 months in the past 5 years, or own a property outright
• be resident in the UK
• earn at least £10,000 a year (£15,000 if you want to borrow more than 75% of the purchase price).

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Step 3 : How much can you borrow?

Unlike a standard residential mortgage, the amount you can borrow is based upon the expected rental income rather than your personal one. At Bank of Ireland Mortgages we'll lend you up to 85% of the purchase price - or the valuation, if it's lower. Which means that you will have put down at least 15% deposit. The rental income must be on an unfurnished basis and be equal to, or greater than:

100% of your monthly interest repayments (if the mortgage you have chosen is fixed for 3 years or more).

OR

118% of your monthly interest repayments (if you have chosen any other mortgage type).

Use our Buy to Let calculators to determine how much you can borrow.

Step 4 : Repayment methods

There are three main repayment methods available:

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Step 5 : Property Criteria

As with most lenders, we want to ensure that you'll be able to meet the repayments. Take a look at the simple checklist below to see if your investment property meets our criteria.

Qualifying properties must be:

• worth more than £40,000
• ready to let in its current state, or after minimal improvements such as redecorating

Non qualifying properties include:

• an ex Local Authority flat valued at less than £90,000 (we do accept ex Local Authority houses).
• an office block conversion
• a speculatively converted Local Authority block.
• open decking

In the case of flats and studios in mixed developments (e.g. above a shop) we can only lend up to 75% of the purchase price.

With regards to multiple investments we allow a maximum of two properties per apartment block or full postcode area.

We do not accept flats or maisonettes built within the last 12 months or being purchased for the first time since conversion. Houses built within the last 12 months or being purchased for the first time since conversion are acceptable up to 75% LTV.

Step 6 : Protecting your investment

Property Management

Your new property will need someone to take on the landlord's management responsibilities. For example, are you going to collect the rent, and find the tenants? Or are you going to entrust a letting agency to do this for you?

Letting agents can save you time looking for tenants and manage the property for you, but they do charge for this service. Agents' fees are normally 10-15%, which is dependent on the level of responsibility you give them.

Tenancy agreements

You've put a lot of hard work into finding the right investment property, so you want to protect its value, so we insist on the following tenancy agreements:

• Your tenants must be standard residential tenants who are unrelated to you. The property must not be let to the seller during the twelve months after completion. Student lets are also acceptable (maximum 4 tenants).
• There must be an Assured Shorthold Tenancy in place (or Short Assured Tenancy in Scotland). This is an agreement which gives the landlord the right to have the property back at the end of the term of the tenancy.

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Step 7 : Ensure you prepare for an empty property

You may have just bought a fabulous little pad that everyone is going to love, but there is a good chance that there will be a time when your property may remain empty. You must bear in mind that when there are no tenants in the house, you will still have to make your mortgage repayments - think carefully about the type of mortgage that will help safeguard your investment.

You will also need to ensure that your property is insured when left empty for periods of time and also covers a property rented out by tenants - it is your responsibility as a landlord to get the correct buildings insurance for these scenarios.