Background properties owned by the applicant
Properties that are not rented out
The existing mortgage payment must be keyed as a credit commitment and will be included in the affordability calculation.
It is also essential that the associated running costs from background properties that are not rented out (e.g. second home applications with a residential property in the background or residential application with a second home in the background) are considered in the affordability calculation. To ensure this, associated running costs should be keyed as 'other' in Household Expenditure (see Affordability - other costs).
Existing property to be rented out
The mortgage property must be keyed into the 'Existing mortgages' screen. If you select 'Yes' to 'Is the property let?', this will allow you to enter monthly rental income. If confirmation is required we would request a letter from the letting agent confirming the expected rental income.
Other Buy-to-Let mortgaged properties owned
Other let properties must be keyed individually in the 'Existing mortgages' section. If you select 'Yes' to 'Is the property let?', this will allow you to enter monthly rental income for each individual property. If confirmation is required we would request one of the following:
- A letter from the letting agent confirming the rental income.
- Latest 3 months’ consecutive bank statements showing rental income.
- Copy of the current Tenancy Agreement.
- Letter from accountant or solicitor.
In order for background BTL properties to be considered as self funding, 69% of the total rental income will be calculated and must be greater than the total monthly payments of all background BTL mortgaged properties. No surplus will be considered as additional income, and any deficit will be deducted as a commitment within the affordability calculation.