SPV Buy-to-Let Mortgages

This page is for landlords and property investors who hold, or plan to hold, buy-to-let property through a limited company set up as a Special Purpose Vehicle (SPV) — and who want to understand how lenders assess these cases, what they require, and where a specialist broker adds value. If you are weighing up whether to buy in a company name, or you already own an SPV and need finance for a purchase or remortgage, this is the page for you.

Working across more than 135 lenders, Propertyze approaches SPV lending criteria-first: the question is not only what rate you can get, but which lenders will lend at all on your structure, and how to present the case correctly so it reaches the right desk. SPV buy-to-let is a specialist corner of the market, and matching the company, the directors and the property to a lender's appetite is where most of the value sits.

Key facts at a glance

• What an SPV is: a limited company set up solely to hold and let property, kept "clean" so its only activity is property — lenders much prefer this to a trading company that also does other things.
• SIC codes: lenders typically want property-only SIC codes, commonly 68100 (buying and selling of own real estate), 68209 (letting and operating of own or leased real estate) and 68320 (management of real estate on a fee or contract basis).
• One company, many properties: a single SPV can hold any number of properties — there is no need to incorporate a new company for each purchase.
• Personal guarantees: directors and shareholders are almost always asked to give a personal guarantee, and lenders often take a floating charge (debenture) over the company.
• Affordability: assessed on the property's rental income against the lender's interest coverage ratio (ICR) stress test, not on your personal salary.
• ICR thresholds: for limited companies an ICR of around 125% is commonly applied as a typical default, though this varies by lender and product.
• Tax: since the Section 24 restriction on individual landlords' mortgage-interest relief, many higher-rate landlords use SPVs so finance costs remain fully deductible against corporation tax — this is a planning choice, and you should take advice from a qualified accountant or tax adviser.
• Regulation: most buy-to-let lending, including SPV buy-to-let, is unregulated business and is not regulated by the Financial Conduct Authority (some cases, such as certain family or consumer buy-to-lets, can be regulated — we will tell you which applies to you).

How SPV lending works and why SIC codes matter

An SPV is simply a limited company whose only purpose is to hold and let property. Lenders favour this because it is predictable: there is no separate trading business whose debts, contracts or cash-flow could complicate the security, and the company's accounts are straightforward to underwrite.

That preference shows up most clearly in the SIC codes — the Standard Industrial Classification codes recorded at Companies House that describe what a company does. Buy-to-let lenders generally want to see property-only codes, commonly 68100 (buying and selling of own real estate), 68209 (letting and operating of own or leased real estate) and 68320 (management of real estate on a fee or contract basis). A company carrying unrelated trading codes, or a dormant company later repurposed, can narrow the range of lenders willing to consider it. Where an existing company's codes are not clean, they can usually be updated at Companies House, though some lenders look at how long the SPV has been established and how it has been used.

A single SPV can hold any number of properties; you do not need a new company for every purchase. Many landlords run an entire portfolio through one SPV, while others use a small number of companies for estate-planning or ownership reasons. That is a structuring decision with tax and administrative consequences, so it is worth taking advice before you commit to a particular shape.

Affordability: rental income against the ICR stress

SPV buy-to-let affordability is assessed on the property, not on your payslip. The core test is the interest coverage ratio (ICR), also called rental cover or the rental stress test: the lender checks that the expected rent comfortably exceeds the mortgage interest, calculated at a stressed (notional) rate that is usually higher than the actual pay rate. The stress builds in headroom for voids, maintenance and possible rate rises.

For limited companies, an ICR of around 125% is commonly applied as a typical default. By way of illustration only — not a quote and not a live rate — at a stress rate of 5.5% and a 125% ICR, a £200,000 loan would need rent of roughly £1,146 a month to pass. These figures are illustrative; the real numbers depend on the lender, the product and the property. Where a product is fixed for five years or more, lenders often stress more leniently, which can support a larger loan on the same rent. If you hold four or more mortgaged buy-to-let properties you are likely to be treated as a portfolio landlord, which brings whole-portfolio underwriting and a full property schedule into the assessment.

Tax and structuring: why many landlords use an SPV (take advice)

Since the Section 24 changes phased out full mortgage-interest tax relief for individual landlords — replacing it with a basic-rate tax credit rather than a deduction — many higher-rate and additional-rate landlords have looked at holding property through a company instead. The headline reason is that, within a company, finance costs (including mortgage interest) are generally a deductible business expense set against profits for corporation tax, rather than being restricted as they are for individuals.

This is genuinely material for some landlords and makes little difference for others. Whether an SPV is right for you depends on your income, your wider tax position, how you intend to draw profits, your plans for the properties and your estate-planning aims. There can also be costs and tax consequences when moving existing personally-held property into a company. It is essential to take advice from a qualified accountant or tax adviser before deciding — this page explains how the lending works, not what is best for your tax position. One point worth flagging: the Annual Tax on Enveloped Dwellings (ATED) can apply to higher-value dwellings held in a company where the property is not genuinely let on a commercial basis, so high-value company-held property used personally needs particular care.

Personal guarantees, debentures and non-crystallisation

Because an SPV is a limited company with limited liability, lenders look for additional comfort, and that almost always means a personal guarantee (PG) from the directors and shareholders. A PG means that, if the company cannot meet its obligations, you can be pursued personally up to the guaranteed amount — so it is important to understand the figure you are signing up to and to take legal advice where appropriate. Some lenders cap the guarantee at a proportion of the loan; others require it in full.

Lenders also frequently take a floating charge over the company, granted through a debenture. This sits over the company's assets generally rather than over a single named property. The practical knock-on is that, once one lender holds a debenture, each subsequent loan from a different lender typically requires a letter of non-crystallisation — a confirmation from the existing charge-holder that it will not crystallise its floating charge against the new lender's security. Arranging these can add time to a multi-lender portfolio, which is one reason the order in which you borrow, and from whom, is worth planning. A broker who handles SPV cases regularly will anticipate this rather than discover it late in the process.

Why a specialist broker helps and how lender appetite varies

SPV buy-to-let appetite varies widely between lenders. Some are entirely comfortable with company borrowing and have built their criteria around it; others are more cautious about newly-formed SPVs, complex shareholdings, corporate directors, or guarantors who are not UK-resident. Many of the lenders active in this space work through intermediaries rather than directly with the public, so going it alone can simply put parts of the market out of reach.

This is where Propertyze's criteria-first approach earns its place. We start with the structure — the company, the SIC codes, the directors and guarantors, the existing portfolio and any debentures already in place — and work out who will realistically lend before discussing terms. We then present the case the way each lender wants to see it, which helps avoid a declined application that leaves a footprint and wastes time. With access to more than 135 lenders, the aim is to find a workable route, not just the first one.

Common complications we handle

• A newly-incorporated SPV with no trading history, where some lenders want a track record.
• An existing company carrying non-property SIC codes that need cleaning up before it will fit lender criteria.
• A portfolio landlord with four or more mortgaged properties, triggering whole-portfolio underwriting and a full schedule.
• A second or subsequent purchase where an existing debenture means a letter of non-crystallisation is required.
• Directors or shareholders who are not UK-resident, or a corporate shareholder sitting above the SPV.
• Moving personally-held property into an SPV, with the SDLT and capital gains consequences that can involve (take advice first).
• A landlord whose personal income is strong but the rent on a lower-yielding property is tight against the ICR, where surplus income may be considered by some lenders.

The process

1. Initial conversation — we talk through your structure, the property or portfolio, your goals and your timescales, and flag anything that may affect lender choice.
2. Structure and criteria review — we check the SPV's SIC codes, shareholding and existing charges, and identify the lenders whose criteria realistically fit.
3. Case preparation — we package the application the way the chosen lender wants to see it, including the portfolio schedule where you are a portfolio landlord.
4. Submission and offer — we submit, manage the lender's questions and valuation, and keep you updated as the case progresses to offer.
5. Through to completion — we work alongside your conveyancer, deal with any debenture and non-crystallisation requirements, and stay with the case until completion.

As a general guide, expect to provide company details and SIC codes, recent company accounts (where the SPV has trading history), bank statements, a portfolio schedule if you hold multiple properties, identification for each director and guarantor, and details of the property and expected rent. Timescales vary with the lender, the property and the conveyancing, so we will give you a realistic picture for your specific case rather than a fixed promise.

Frequently asked questions

What is an SPV? An SPV (Special Purpose Vehicle) is a limited company set up solely to hold and let property. Keeping it "clean" — property activity only — is what most buy-to-let lenders prefer to see.

Which SIC codes should an SPV use? Lenders typically look for property-only codes, commonly 68100 (buying and selling of own real estate), 68209 (letting and operating of own or leased real estate) and 68320 (management of real estate on a fee or contract basis). The exact preference can vary by lender.

Can I move my existing personally-held property into an SPV? It is possible, but it is a sale from you to the company and can trigger Stamp Duty Land Tax and capital gains considerations, among other costs. The right answer depends on your circumstances, so take advice from a qualified accountant or tax adviser before doing anything.

Do I need a new company for each property? No. A single SPV can hold any number of properties, so most landlords run a portfolio through one company. Whether one company or several suits you is a structuring and tax question worth taking advice on.

Are SPV mortgage rates higher than personal buy-to-let rates? Pricing depends on the lender, the product, the loan-to-value and the strength of the case rather than on the company wrapper alone, so it is not a simple yes or no. We will compare the realistic options for your specific structure rather than assume one is always dearer.

Is an SPV buy-to-let mortgage regulated by the FCA? Most buy-to-let lending is unregulated business and is not regulated by the Financial Conduct Authority. Some buy-to-lets — for example certain family arrangements — can be regulated, and we will tell you which applies to your case.

Speak to a specialist

If you are buying or remortgaging property through an SPV, or deciding whether a company structure is right for you, we can talk you through the lending side and find a workable route across our panel. Call 020 7126 8574 or request a call back, and we will reply within one working day.

Your property may be repossessed if you do not keep up repayments on a mortgage secured on it.

Most buy-to-let mortgages are not regulated by the Financial Conduct Authority. Propertyze is a trading style of City Finance Brokers Ltd, authorised and regulated by the Financial Conduct Authority (FCA No. 766295). We conduct both regulated and unregulated business, so not all products provided through us are regulated by the FCA.