Mortgage Criteria

Buy to Let Mortgage Criteria

Our Buy to Let mortgage criteria is designed to help your landlord customers to increase their investment and to grow their business. This includes those who are first-time landlords, raising capital on a remortgage or purchasing their next property.

Table of Contents

Applicant criteria

Minimum age:

  • 21

Maximum age:

  • 85 at end of term
  • For joint applications the age of the oldest application is used
  • The term cannot extend beyond the applicants’ stated retirement age

Maximum applicants:

  • 2


  • Not accepted

First-time landlords:

  • Accepted where applicants are homeowners

CCJs & defaults:

  • None in the last 12 months

Mortgage arrears:

  • Arrears status of 0 in last 6 months
  • None missed in the last 12 months

Unsecured arrears:

  • Fixed term: None in the last 6 months
  • Revolving credit: Missed payments considered
  • On Pepper 24, 18 and 12 products we will ignore 2 individual defaults (per application) up to and including £150.00 each where these defaults relate to utilities, communications or mail order providers.

IVA & Bankruptcy:

  • Accepted where applicants have been discharged 6 or more years ago

Debt management plans:

  • Considered if satisfied over 12 months ago

Pay day loans:

  • Accepted where the account closed more than 12 months ago


  • Accepted where repossession occurred more than 6 years ago

Residential status:

  • 3 years’ UK residential address history required for all applicants

EU Nationals accepted subject to:

  • 3 years’ UK residency
  • 3 years’ continuous UK employment history

Non EU Nationals accepted subject to: 

  • 3 years’ UK residency
  • 3 years’ continuous UK employment history
  • Indefinite leave to remain

Diplomatic immunity:

  • Not accepted
Income criteria

Minimum earned income:

  • £18,000 per application

Foreign currency:

  • Not accepted

Rental income:

  • Cannot be the primary income source and only rental income evidenced on SA302s can be included


  • Minimum of 6 months in current job with 12 months’ continuous employment
  • Day rate contractors accepted, subject to being in a contract and able to demonstrate a minimum 12 months’ history. Calculate the income as the lower of 12 months’ average day rate amount or current contract day rate x 5 (days per week) x 46 (working weeks)
  • Contract employees considered provided 12 months’ employment with the same employer together with confirmation the contract will be renewed
  • 3 months’ payslips with 3 months’ bank statements and last P60
  • Applicants in a probationary period not accepted
  • Zero hour contracts acceptable, if a permanent position, with 2 years’ + at same employer and stable income levels
  • Income from seasonal/temporary work not accepted
  • Directors with a shareholding of 25% or more will be underwritten as self-employed
Income typeProportion considered
Basic salary100%
Car allowance100%

Self-employed: sole trader/partnership

  • Minimum of 1 year’s accounts
  • 3 months’ business account bank statements
  • SA302s will only be accepted in addition to the full business accounts. SA302s are not acceptable proof of income on their own but will be requested where the accounts have been prepared by an accountant who does not appear on our list of accepted qualifications. We may also request them to confirm dividends which do not appear in the business accounts.

Additional remuneration considered where applicants own 100% of the company:

  • Directors car allowance
  • Directors pension contributions
  • Use of home as an office
  • Private health insurance

Where additional remuneration is to be added back, finalised accounts will be required

Self-employed: company director

  • Minimum of 1 year’s accounts
  • 3 months’ business account bank statements
  • SA302s may be requested to support company accounts


  • Private pension accepted

Pension income

  • State retirement pension (SRP) – latest annual statement of pension
  • Private pension – latest payslip from pension provider, or letter from pension provider with 3 months’ bank account statements showing credits

Secondary/additional income

  • Employment/self-employment income from a maximum of 2 sources per applicant considered
  • Benefits and maintenance may be included as additional income
Loan criteria

Maximum LTV:

  • 80%

Maximum term:

  • 35 years

Minimum term:

  • 5 years

Minimum loan:

  • £25,001

Maximum loan:

  • Up to £750,000 available to 80% LTV
  • Up to £1 million available to 75% LTV

Number of mortgages with Pepper:

  • Maximum of 3 per applicant, including any joint loans the applicants are party to
  • Can be a mixture of Buy to Let and Residential loans

Remortgage applications:

  • Accepted where applicant has been the registered owner for the last 6 months at application


  • Capital & interest
  • Interest only to 80% LTV, supported by an acceptable repayment strategy and maximum age of 85


  • Products are not portable

Offer validity:

  • 90 days

Let to Buy:

  • Accepted on forward purchases

Right to Buy:

  • Not accepted
Deposit criteria

Evidence of deposit:

  • Required on all purchase applications

Applicants’ savings:

  • Accepted

Capital raising remortgage:

  • Accepted


  • Accepted

Gifted deposit: 

  • Not accepted

Unacceptable sources:

  • Builders deposit
  • Unsecured borrowing
  • Vendor deposit
Property criteria

New build definition:

  • A property is to be considered new if it is a first sale by the builder
  • However, properties which have not sold on physical completion will be considered on an individual basis

Minimum property value:

  • £70,000

Locations considered:

  • England, Wales & Isle of Wight


  • Not offered

Acceptable property:

  • Houses: private and ex-local authority or social housing
  • Flats & maisonettes: private only

Timber framed construction:

  • Modern timber framed properties clad with masonry are considered as acceptable
  • Timber framed properties which are not deemed to be of a modern type clad with masonry will be reviewed on an individual basis and will be considered on their merits

Flying freeholds:

  • Flying freeholds will only be considered up to 20% of the total floor area

Coal mining and other forms of extraction:

  • Any properties with a coal mining or metalliferous mining entry/feature within 20m of any building will not be considered

Electromagnetic fields:

  • Any properties within 100m of above ground high voltage electrical supply apparatus will not be considered

Contaminated land:

  • Where there is potential for contaminated land, a pass certificate must be available from an appropriate body

Japanese knotweed:

  • Where a property has Japanese knotweed (or any other invasive weed) located within or immediately adjacent to the site defined as category 4, 3 or 2 in RICS paper IP 27/2012, it will not be considered

Solar panels:

  • Properties where solar panels have been installed and are subject to a lease agreement will not be considered
  • If the solar panels are owned outright, the application will be reviewed on a case-by-case basis


  • Houses only accepted


  • The lease must have a minimum unexpired term of 85 years at the time of completion


  • Not considered

Structural reports:

Reports may be accepted from members of the following bodies:

  • The Institution of Structural Engineers (
  • The Institution of Civil Engineers (

The report must be referred to the valuer for comment. If the report is not addressed to the applicant, written confirmation must be obtained from the originator that its contents may be relied upon by the applicant(s).

We will not lend on any property with either ongoing movement or where monitoring is required, where this is identified by either the valuer, or where evident in the structural engineers’ report.

The valuer may request additional reports from specific governing bodies.

Specialist reports:

We may require specialists’ reports. These most commonly will be:

  • Timber and damp, electrical, trees, cavity wall ties
  • Mining report (as these are obtained by the solicitors, a special condition is imposed at offer);
  • Any such reports should be prepared by a reputable firm and should be forwarded to us for review and referral to the valuer
  • The valuer may request additional reports from specific governing bodies


  • New build properties without suitable warranty
  • Properties suffering ongoing structural movement or insurance claims
  • Grade I & Grade II* listed properties
  • Back-to-back/cluster homes
  • Properties located within 20m of a mine entry/feature
  • Properties within 100m of above ground high voltage electrical supply apparatus (excluding small substations)
  • Properties subject to compulsory purchase orders
  • Large flying freeholds (greater than 20% of floor area)
  • Japanese knotweed located within or immediately adjacent to the site, defined as category 4, 3 or 2 in RICS paper IP 27/2012
  • Properties without an internal WC, bathroom or kitchen
  • Properties subject to any onerous occupancy restrictions, including agricultural
  • Shared ownership/shared equity schemes (only acceptable if applicant will own 100% of the interest on completion)
  • Properties subject to enforcement notices
  • Crofting properties/land
  • Self-build properties
  • Properties with a commercial element
  • Non-standard construction


  • Flats in local authority or ex local authority owned blocks
  • New build flats/maisonettes
  • Flats with a gross external floor area less than 35m2
  • Flats above commercial premises
  • Studio flats
  • Freehold flats
  • Balcony access

Non-standard construction:

  • Pre-cast reinforced concrete (PRC)
  • Cast-in-situ concrete
  • Metal framed construction
  • Single skin
  • Large panel systems (LPS)
  • Modern methods of construction (MMC)


  • Properties at significant risk of flooding or that cannot be suitably insured will not be considered

Restrictive covenants:

  • We are unable to consider any property with a restricted occupancy clause within the planning permission. For example, it can only be occupied for a maximum of 11 months in any one year
  • Similarly, property that can only be used for retirement or sheltered accommodation is not accepted. This is the same for any property where a planning restriction (e.g. agricultural restriction) effectively limits a property’s appeal on the open market
  • Please note: for new builds we do consider Section 106 planning obligations
  • We are unable to consider properties within a pre-emption period

Full mortgage application:

  • Original, fully signed and dated declaration
  • Signed and dated direct debit mandate

Proof of deposit (purchase):

  • Applicants bank statements

Use of funds (remortgage with a further advance):

  • Breakdown of use of funds, after any debts have been discharged
  • Account details and balance of any debts to be repaid

Proof of address & identification:

  • Any two documents from Table 1 or
  • 1 document from each table
Table 1Table 2
Valid passportValid (old style) full UK driving license
Valid photo card driving license (full or provisional)Recent evidence of benefit entitlement
National identity cardInstrument of a court appointment
Firearms certificate or shotgun licenseCurrent council tax demand letter or statement
Identity card issued by the Electoral Office for Northern IrelandNon-internet generated bank statements and utility bills

Proof of income – employed:

  • Paid monthly – latest 3 consecutive months with P60 and bank statements
  • Paid weekly – latest 6 consecutive weeks with P60 and bank statements

Proof of income – self-employed:

  • Sole Trader – minimum 1 year’s accounts or SA302s with 3 months’ business bank statements
  • Company Director – minimum 1 year’s accounts with 3 months’ business bank statements

Other sources of income:

  • State Pension – latest annual statement of pension/due on retirement
  • Pension credits – latest Pension Credit Award Notice
  • Private pension – latest annual statement of pension/due on retirement or
  • Latest payslip from pension provider or
  • Latest letter from pension provider confirming pension due on retirement

Rental/mortgage history:

  • Tenancy agreement with 12 months bank statements confirming rental payments
  • Last 3 years mortgage statement

Confirmation of rental payments:

  • To support the BTL re-mortgage application and to verify that the recent rental payments have continued to be received from the tenants a copy of the customers bank statement evidencing receipt of the rental payment for the last month should be provided in addition to the AST.

Portfolio landlords:

We accept applicant(s) with a combined maximum of 9 Buy to Let properties, including the application property(s)

Written asset and liabilities statement which includes details of:

  • Levels of rent received on each property – Outstanding mortgages – Current values of each property
  • Details of any void periods in last 12 months and brief overview of intentions for each property

Unacceptable applicants:

  • Currently in receipt of Coronavirus Job Retention Scheme (CJRS)
  • Currently in receipt of the Self Employment Income Support Scheme
  • On a mortgage payment holiday with their current lender

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