Can a Limited Company Get a Mortgage?

Yes, and here is how it works

A limited company gets a mortgage in much the same way an individual does, with the company named as the borrower and legal owner. The overwhelming majority of company lending is buy to let: a company buying residential property to let out. Residential mortgages for a company to house its own director are far rarer and sit outside most lenders' appetite.

The key difference is what the lender looks at. For a personal mortgage the lender tests your income against the loan. For a company buy to let the lender tests the property's rental income against the mortgage interest. The director's own earnings matter for the background check and the guarantee, but they do not set the loan size.

This sits inside the wider limited company property finance picture. If you have not yet decided on the structure, read SPV vs trading company first, because the type of company you form changes which lenders will look at you.

How much can a limited company borrow?

The loan is set by rental income, not by the size of the company or the director's pay. Lenders apply an interest cover ratio: the rent has to cover the mortgage interest by a set margin, tested at a stressed interest rate rather than the pay rate. For company buy to let that margin is commonly 125%, sometimes 145% depending on the lender and the rate type.

In plain terms, a higher rent supports a bigger loan, and a property that only just washes its face on rent will be capped well below 75% of value. This is why two identical properties can secure very different loans through the same company.

These figures are illustrative and move with the stress rate. The limited company mortgage calculator lets you put your own rent in, and the limited company buy to let mortgages page explains lender appetite in more depth.

What deposit does a limited company need?

Plan for 25% of the purchase price. That gives a mortgage of up to about 75% loan to value, which is where most of the competitive company buy to let market sits. A handful of lenders stretch to 80%, but the rate premium usually eats the benefit of the smaller deposit.

The deposit almost always goes into the company as a directors loan. The director lends their own money to the company to fund the purchase, the company records the debt, and it can repay the director later without that repayment being taxed as income. Getting this recorded correctly from day one matters.

Which lenders lend to limited companies, including new ones

Company buy to let is a specialist market rather than a high street one. Building societies and specialist buy to let lenders dominate it, and most of them are comfortable lending to a company formed the day before the application, provided it is a clean special purpose vehicle with the right property SIC codes.

A newly incorporated SPV with no accounts is normal here, not a red flag. What the lender underwrites instead is the directors: their credit history, any background portfolio and their experience as a landlord. First time landlords are lent to, but the panel narrows and the rate firms up.

The company has to be set up the way lenders expect it. Get the SIC codes for property companies right before you apply, because the wrong code is a common and avoidable cause of decline.

The requirements: what a company needs before applying

Before applying, a company needs a few things in place. The requirements are less demanding than many first time landlords expect, but getting them right removes the common reasons an application stalls. A clean SPV, the correct SIC codes and a business bank account are the practical basics.

1. A limited company set up with property SIC codes reflecting its buy to let status.
2. A business bank account in the company name for rent and mortgage payments.
3. Directors with a reasonable personal credit status, checked before applying.
4. The deposit funds available, usually via a directors loan, with a clear source.
5. Latest personal financial details for the directors, as lenders assess them for the guarantee.

Whether a director is employed or self-employed does not stop a company buy to let, because the loan rests on the rent rather than the director's earnings. It can still affect the background check and any personal borrowing you hold, so it is worth reviewing your wider position before applying. A broker matters here: getting a company case to a lender whose requirements it already meets is most of the work.

Get the structure right first with SIC codes for property companies, and when a fixed rate ends and you want to switch, the same rental income and interest cover considerations apply to the remortgage.

The personal guarantee: what directors sign

Because a company can be wound up and its directors walk away, lenders bridge that gap with a personal guarantee. Each director gives a personal promise to cover the company's mortgage debt if the company defaults. It gives the lender recourse to the individual, and it is a standard, non negotiable feature of company buy to let lending.

A guarantee is not the same as being personally named on the mortgage. It usually only bites if the company fails to pay and the sale of the property does not clear the debt. Even so, it is a real liability that a director should understand fully before signing, particularly where several directors are jointly and severally liable.

We walk clients through exactly what they are signing and how to cap it in personal guarantees on company mortgages. It is worth reading before you commit.

Buying, remortgaging and pulling money out

A company can do everything an individual landlord can: purchase, remortgage at the end of a fixed rate, and raise capital against equity that has built up. A company remortgage works on the same rental income and interest cover ratio logic as a purchase, so a property that has grown in value or rent can often release cash for the next deposit.

One point that trips landlords up is drawing profit out. The company can save real tax on rental income, but extracting it as dividends brings a second layer of personal tax. Rental income stays in the company cheaply; getting it into your pocket costs more. That is a feature to plan around, not a flaw.

Special purpose vehicle (SPV)

A company set up only to hold and let property, the structure most buy to let lenders require for company lending.

Interest cover ratio (ICR)

The margin by which rent must cover mortgage interest at a stressed rate, usually 125% to 145% for company buy to let.

Directors loan

Money a director lends to their own company, commonly used to fund the deposit and repayable to the director without income tax.

Personal guarantee

A director's personal promise to repay the company's mortgage debt if the company defaults, giving the lender recourse beyond the property.