Can I borrow more when I remortgage a buy-to-let?

In 2026 the rental test has become the tighter of the two for many landlords. Bank Rate rose to 4% on 5 November, and lenders assess rent against a "stress" interest rate. When that rate goes up, the same rent supports a smaller loan.

Capital raising on a buy-to-let remortgage is different from equity release lifetime mortgages, which are a homeowner product for later life. This guide covers how lenders work out the numbers, what they ask about the money, the costs involved and a worked example.

Loan-to-value: how equity is worked out

Equity is the difference between what the property is worth and what is owed on it. When you remortgage, the new lender instructs a valuation, so any rise in value since you bought or last remortgaged can increase the equity available.

Lenders then cap the loan at a percentage of that value, the loan-to-value (LTV). Most buy-to-let mortgages need at least 25% equity, so 75% LTV is a common ceiling. Some lenders go to 80% or higher, usually at higher rates.

Example	60% LTV	75% LTV
Property value	£250,000	£250,000
Largest loan by LTV	£150,000	£187,500
Current mortgage balance	£120,000	£120,000
Extra borrowing possible by LTV alone	£30,000	£67,500

The figures are illustrative and before fees. The rental test, covered next, often reduces them.

LTV also affects pricing. In Moneyfacts' best-buy list on 3 November 2026, the lowest five-year fixed buy-to-let rate was 4.59% at 60% LTV, 4.64% at 75% and 5.29% at 80%.

Timing of ownership matters too. Many lenders prefer you to have owned the property for at least six months before remortgaging on its new value, although some specialist lenders will consider it sooner.

Rental cover: often the real limit on borrowing

Buy-to-let lenders mainly judge affordability on rent. They check the rent covers the mortgage interest by a set margin, the interest cover ratio (ICR), with interest worked out at a "stress" rate.

The basic sum is:

Maximum loan = annual rent ÷ (stress rate × ICR)

Common settings are 125% ICR for limited companies and basic-rate taxpayers and 145% for higher-rate taxpayers, with some lenders asking for 160%. Stress rates commonly sit between 5.5% and 8%. Prudential Regulation Authority rules set a 5.5% minimum for loans fixed for under five years.

For a property let at £1,000 a month (£12,000 a year), the rental test gives these interest-only limits:

Stress rate	At 125% ICR	At 145% ICR
5.5%	£174,545	£150,470
7.0%	£137,143	£118,227

The figures are illustrative and vary by lender. You can try your own figures in our rental cover calculator.

Several factors change the result:

• Product length. Many lenders test five-year fixes at or near the actual rate, so they can support a larger loan than a two-year fix.
• Tax status and ownership. Limited companies are usually tested at 125% whatever the owners' personal tax band.
• Personal income. Some lenders let earnings make up a small rent shortfall, known as top-slicing.
• Fee structure. A product with a higher fee and lower rate can lift the loan the rent supports at some lenders.
• Property type. HMOs and multi-unit blocks often have higher ICRs.

What lenders ask about the money

Lenders want to know what extra borrowing is for, and some ask for evidence such as a builder's quote or details of a purchase. Purposes lenders commonly consider include:

• improvements or repairs to the property, including energy-efficiency work
• a deposit for another buy-to-let property
• repaying a bridging loan used to buy or refurbish a property
• buying out a co-owner's share

Paying off other debts gets closer scrutiny, and some lenders limit or decline it. Acceptable purposes vary from lender to lender.

Raising money also tends to lengthen the process. Brokers commonly quote six to eight weeks for a remortgage with capital raising, compared with four to six weeks for a like-for-like switch. See how long a buy-to-let remortgage takes.

There are other routes too. Borrowing more from the existing lender, called a further advance, can avoid changing lender, although it may still need a valuation and underwriting. Some landlords use a second-charge loan alongside the existing mortgage, typically at a different rate.

Costs and tax points to be aware of

Raising money on a remortgage carries costs that reduce the amount actually released:

• Arrangement or product fees. These are either a flat fee or a percentage of the loan. Which? found some of the cheapest buy-to-let rates in November 2026 charged 5% of the loan, while other deals charged around £999 to £1,500.
• Valuation fees, sometimes included free.
• Legal fees, often included free on remortgage products.
• Broker fees, which some brokers charge.
• Early repayment charges if the current deal is left before it ends, plus any exit fee.

Adding fees to the loan increases the balance and the interest paid on it.

On tax, the position depends on how the property is owned:

• Individual landlords cannot deduct mortgage interest from rental profit. Instead they receive a tax credit at the basic rate: 20% for 2026-27, and 24% from April 2027 as announced in the October 2026 Budget.
• Whether interest on extra borrowing qualifies depends on what the money is used for. HMRC has specific rules on this, and an accountant can confirm the position.
• Limited companies deduct mortgage interest as a business cost before Corporation Tax.
• Buying another property with the money usually means paying the 5-percentage-point Stamp Duty surcharge on additional homes in England and Northern Ireland.

A worked example

Take a property valued at £250,000, with £120,000 left on its mortgage and rent of £1,000 a month. The landlord wants to know how much extra could be raised on an interest-only remortgage.

Test applied	Largest total loan	Extra borrowing before fees
Loan-to-value at 75%	£187,500	£67,500
Rental test at 125% ICR, 5.5% stress rate	£174,545	£54,545
Rental test at 145% ICR, 5.5% stress rate	£150,470	£30,470
Rental test at 125% ICR, 7% stress rate	£137,143	£17,143

The lender applies whichever limit is lowest for the product and borrower. Here the rent, not the property value, sets the ceiling in every case. A basic-rate taxpayer on a product tested at 5.5% might raise around £54,500. A higher-rate taxpayer on a shorter product tested at a higher rate might raise far less.

If the same property were let at £1,200 a month, the rental test at 125% and 5.5% would allow about £209,455. The 75% loan-to-value cap of £187,500 would then become the limit instead.

These figures are illustrative only. Real results depend on the lender, the product, fees, the valuation and the landlord's wider circumstances.

Talk to a buy-to-let broker

Tell us a little about your property and when your current rate ends, and we will put you in touch with a buy-to-let broker who can compare the options. Free, no obligation, no credit check.

Get matched with a broker

Important information. This article is general information about the UK buy-to-let market, written as at 7 November 2026. It is not financial, tax or legal advice and is not a recommendation of any product or course of action. Examples are illustrative only. For tax questions, speak to a qualified accountant or tax adviser. Buy to Let Remortgages does not give advice or arrange mortgages. We pass enquiries to a buy-to-let mortgage broker. Most buy-to-let mortgages are not regulated by the Financial Conduct Authority. All lending is subject to the lender's criteria, valuation and underwriting. Your property may be repossessed if you do not keep up repayments on your mortgage.

Sources