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How can a lifetime mortgage help fund a buy-to-let purchase?

If you’re over 55 and wish to invest in a buy-to-let property, a lifetime mortgage could help. This type of equity release allows you to unlock tax-free cash from your main home to use for the purchase, while retaining full ownership of your home.

How much you can borrow depends on your age, home value and health. Typically, the older you are, the more you can release. The funds can be used to purchase a buy-to-let property outright or as a deposit.

The loan is typically repaid when you pass away or move into long-term care. There are no mandatory monthly repayments in the meantime, though some providers allow voluntary interest payments to prevent your loan from growing in size.

Why choose a lifetime mortgage to help fund a buy-to-let purchase?

Many homeowners over 55 are ‘asset rich, cash poor’ with property wealth tied up in their main home. A lifetime mortgage could enable you to tap into that value to step into the rental market or expand your existing portfolio.

Whether it’s buying a city flat, family home or countryside rental, this form of funding may open the door to starting or growing your property investments. You will still own your main residence, with interest payments on the loan optional, giving you flexibility to manage your finances your way.

This could be perfect if you want:

  • Tax-free cash to help buy a rental property.

  • No obligation to make monthly repayments, with the choice to pay interest voluntarily.

  • To keep full ownership of your main home and continue living there.

  • To be able to pay back your original loan early if you wish - although early repayment charges may apply.

Five star reviews from happy customers

Taking out equity release is a big decision, so it’s good news that our selected advisers enjoy great feedback and an ‘excellent’ Trustpilot rating from customers who have used the service.

Highly recommended

Explained everything from the first phone call we made to completion, giving us time to understand all the options. Everything went smoothly - would highly recommend.

Brilliant service

The service we have received so far has been brilliant. The documentation came through very quickly, but we have not been put under any pressure to make a decision.

Help was always on hand

Everything explained to me every step of the way and always time to ask questions which are always fully answered. I never felt pressured to make a decision but help was always on hand.

What options do I have with a buy-to-let lifetime mortgage?

As we have seen, a lifetime mortgage could enable you to unlock money from your main residence to help fund a buy-to-let purchase. You’ll still own your main home, there are no mandatory monthly repayments, and any interest payments you make are entirely voluntary.

Buy-to-let lifetime mortgages have also previously been available that let you release money from a buy-to-let property. Although typically unavailable at the moment due to current market conditions, they gave consumers two further options:

Release equity from a buy-to-let you already own

Some lenders have offered existing landlords the opportunity to unlock cash from their buy-to-let property to spend however they wish. The loan plus interest would usually only be repaid when the property is sold, so there are generally no monthly payments.

Fund a buy-to-let you’re buying outright

A more niche option has been to arrange equity release on a property you’re in the process of buying. This would help cover a shortfall without the hassle of a traditional mortgage or monthly repayments – though you would not be able to have both a standard mortgage and equity release on the same property.

Although these two options aren’t currently available, rest assured that the team at Compare More will be keeping a close eye on developments and we’ll update this page if anything changes.

How much can I release with a buy-to-let lifetime mortgage?

How much you can release depends on a number of factors:

  • Property value: There will be a maximum release based on a percentage of your home’s value.

  • Your property: Your current property’s tenure (freehold or leasehold), location and type of construction.

  • Your age: The older you are, the more you will be able to borrow with a lifetime mortgage. Someone aged 55 will typically be able to release around 20% of their property’s value, rising to over 50% for the oldest applicants.

  • Your health or lifestyle: An enhanced lifetime mortgage may let you release more if you are living with certain health conditions or make certain lifestyle choices such as smoking.

Things to consider

As with most decisions about financial matters, you do need to weigh up the pros and cons of a buy-to-let lifetime mortgage. Although lifetime mortgages can help you to do more of the things you want, there are potential disadvantages to consider:

  • Unlocking your property wealth will reduce the size of inheritance you can leave. The loan plus interest is repaid from the sale of your home, so there’s less equity to pass on.

  • If you leave the interest to roll-up each month, the amount owed can grow quickly. Lifetime mortgages work on a compound interest basis, where interest is applied to the loan amount plus any interest already accrued.

  • When you release money, it might affect your eligibility for homecare funding and other means-tested benefits.

  • Early repayment fees will typically apply should you wish to repay the loan plus interest early. However, lenders may waive these fees in some circumstances.

  • If you gift some of the money you release to family or friends, they may be liable to pay inheritance tax when you pass away.

How to get your lifetime mortgage quotes

At Compare More we work with specialist partners who bring you quotes from the UK’s leading lifetime mortgage providers. To show quotes that match your circumstances and needs, we’ll need to know:

Your property type and value

The type and value of your property will impact how much you can release: the higher the value, the more you can release. We also ask whether you have an outstanding mortgage, as you will need to use the money you release to clear your existing mortgage.

The reason you are considering equity release

This can help tailor the service to your circumstances – but if you’d rather not say at this stage, just select ‘other’.

Your personal details

You’ll need to share details like your age and postcode as these will also affect how much you can release. We also need some contact details so we can get in touch with information about your quotes. 

Equity release guides

Answering your questions about buy-to-let lifetime mortgages

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Explore your options and find the equity release plan that works for you.

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Page updated on 10th September 2025, Reviewed by Richard Groom